- The price of Silver maintains its position as traders adopt caution due to growing uncertainty surrounding the results of the US elections.
- Opinion polls indicate that former President Trump and Vice President Harris are almost tied.
- Silver demand could increase due to rising expectations of additional stimulus measures from China.
The price of Silver (XAG/USD) maintains its position around $32.50 during Asian trading hours on Tuesday, as traders adopt caution ahead of the US presidential election. However, growing uncertainty in surrounding the elections has led to an increase in demand for safe haven assets such as Silver.
The risk-averse sentiment has been amplified by speculation that a possible presidency under Republican candidate Donald Trump could lead to higher inflation, given his pledge to significantly increase trade tariffs. This has led investors to seek safe-haven assets as a hedge against long-term inflation risks.
However, opinion polls indicate that former President Donald Trump and Vice President Kamala Harris are almost tied. The final result may not be known for several days after Tuesday’s vote. Both Trump and Harris expressed confidence in their chances as they campaigned in Pennsylvania on the frenetic final day of this exceptionally close presidential race.
The policy decision of the US Federal Reserve (Fed) will be observed on Thursday. Markets expect a modest 25 basis point rate cut this week. The CME’s FedWatch tool shows a 99.5% probability of a quarter-point rate cut by the Fed in November. This could provide support for Silver as lower interest rates reduce the opportunity cost of holding non-interest bearing assets.
Expectations of additional stimulus measures from China could boost demand for Silver as the National People’s Congress (NPC) Standing Committee holds a five-day meeting from November 4-8. Chinese authorities are expected to approve a possible stimulus package exceeding 10 trillion yuan to support the country’s economy. Given China’s position as one of the world’s largest manufacturing centers for electronics, solar panels and automotive components, this could lead to an increase in demand for Silver.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
