Silver holds steady as weak dollar supports

Silver prices hovered around $36 per ounce on Wednesday, remaining largely unchanged for a third consecutive session and gaining support from a weaker dollar amid growing trade and fiscal uncertainties in the US. The precious metal’s stability reflects its traditional role as a safe-haven asset during times of geopolitical and economic tension, as investors weigh mixed signals from policymakers and legislative developments.

Those moves came as Fed Chair Jerome Powell reiterated on Tuesday that the central bank remains patient regarding additional interest rate cuts but did not rule out easing at this month’s meeting.

He also noted that the Fed would have already cut rates if not for the inflationary effects of President Donald Trump’s tariffs, underscoring the complex balancing act the central bank faces amid competing economic pressures. Powell’s cautious stance has contributed to a somewhat subdued market reaction, as investors remain uncertain about the timing and magnitude of any future monetary easing.

Adding to investor caution, the Senate narrowly approved Trump’s tax-and-spending bill, which is projected to increase the national debt by $3.3 trillion, sending the legislation back to the House for final consideration. The bill’s potential to exacerbate fiscal deficits and inflationary risks has sparked concerns over longer-term economic stability, prompting some investors to seek refuge in silver and other precious metals.

Markets are now focused on upcoming labor market data, including ADP’s private payrolls report due Wednesday and the key June jobs report on Thursday, for further signals on the economic outlook and potential Fed policy moves. Stronger-than-expected employment figures could diminish the likelihood of rate cuts, while weaker data might reinforce expectations of easing, adding volatility to silver prices in the near term.

Meanwhile, ongoing trade tensions, particularly between the US and major partners, continue to weigh on investor sentiment, limiting significant price movements in silver despite its supportive macro backdrop. Overall, the metal remains in a tight trading range, with market participants awaiting clearer direction from economic indicators and policy signals to drive the next meaningful move.