- Silver price finds support near $30.20, as investors had already priced in a rosy interest rate guidance in the FOMC minutes.
- US weekly jobless claims fell to 215,000, down from estimates of 220,000 in the week ending May 17.
- The US dollar and bond yields remain under pressure on the prospects of a Fed rate cut.
The price of the Silver (XAU/USD) stabilizes near $30.20 after a vertical drop in the American session on Thursday. The sharp drop in the white metal was fueled by the Federal Open Market Committee (FOMC) Minutes from the May monetary policy meeting, which indicated that officials also discussed the possibility of raising interest rates again. interest, since progress in the disinflation process stalled in the first quarter of the year.
However, the impact of the hawkish FOMC's communication on bullion is assumed to be temporary, as policymakers' views were based on inflation data for the first quarter of this year that had been stubbornly higher. high. Consumer price inflation data for April declined as expected and indicated that price pressures are on track to return to the desired 2% rate.
The 10-year US Treasury yield falls to 4.42% as weak inflation data provides an unfavorable scenario for interest rates to remain higher for longer. A decline in yields on interest-bearing assets decreases the opportunity cost of holding an investment in non-interest-bearing assets such as silver.
The US Dollar Index (DXY) retreats 0.2% and trades near 104.70, as investors remain firm that the Federal Reserve (Fed) will begin to reduce interest rates from the September meeting.
The Dollar Index struggles to stabilize even though the US Department of Labor has released a lower-than-estimated number of initial jobless claims for the week ending May 17. The number of people applying for unemployment benefits for the first time was lower at 215,000 compared to estimates of 220,000.
Silver technical analysis
The price of Silver is trading in an ascending channel chart pattern formed on a daily time frame in which each retracement move is considered a buying opportunity by market participants. The bullish 20-day and 50-day exponential moving averages (EMA) suggest that the short-term trend is bullish.
The 14-period RSI is oscillating in the bullish range of 60.00-80.00, indicating that momentum has tilted to the upside.
Silver Daily Chart
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.
