Silver holds gains on Fed rate cut bets

Silver prices held above $38.5 per ounce on Thursday, lingering near a three-week high as expectations for more aggressive Federal Reserve rate cuts this year underpinned the market.

The rally was reinforced by softer-than-expected U.S. inflation data, which suggested that President Donald Trump’s recently implemented tariffs are not yet feeding into broader consumer price pressures. Signs of cooling in the labor market — including rising jobless claims and slower hiring momentum — further cemented the dovish narrative.

Markets have now almost fully priced in a September rate cut, with growing speculation that the Fed could opt for a larger 50-basis-point reduction rather than the widely anticipated 25-basis-point move.

Treasury Secretary Scott Bessent added fuel to these expectations, calling for multiple rate cuts over the remainder of the year and suggesting that the first step in policy easing could indeed be a half-point cut. Such a move would likely weaken the U.S. dollar and compress bond yields, improving the relative appeal of non-yielding assets like silver.

Beyond monetary policy, geopolitical considerations are adding to the precious metal’s safe-haven bid. Traders are closely watching the upcoming U.S.–Russia talks in Alaska concerning the war in Ukraine.

The White House has characterized the planned meeting between President Trump and Russian President Vladimir Putin as “a listening exercise,” signaling that any immediate breakthrough toward a ceasefire is unlikely. Persistent geopolitical uncertainty, coupled with broader trade tensions, continues to bolster investor interest in defensive assets.

Silver’s performance also reflects its dual role as both a safe-haven and an industrial metal. Strong demand from the renewable energy sector — particularly in solar panel production — remains a key structural support, even as short-term price movements are dominated by macroeconomic and geopolitical headlines.

In the near term, attention will remain on Fed communications, U.S. economic data, and developments in Alaska, all of which could shape the trajectory of precious metals markets heading into the final quarter of the year.