Silver Price Forecast: XAG/USD falls to near $30.00 as Fed may maintain higher rates

Silver price loses ground as Fed is expected to maintain higher rates for longer.
Fed officials suggested maintaining a restrictive monetary policy is needed to achieve a 2% inflation target.
Silver loses its appeal as Israeli Prime Minister Benjamin Netanyahu's administration accepts the US proposal for a Gaza cease-fire.

Akhtar Faruqui FXStreet

Silver price extends losses to near $30.20 per troy ounce during the European trading session on Monday. The prices of the grey metal depreciated after the US Personal Consumption Expenditure (PCE) data was released on Friday. This inflation report indicated that price pressures eased in April.

The Federal Reserve (Fed) may need more time to meet its 2% inflation target since the mixed inflation statistics did not lead to a mood of a rate cut from the central bank. Higher interest rates are having a detrimental effect on non-yielding assets such as silver.

Furthermore, Federal Reserve (Fed) representatives conveyed last week that the central bank may continue its tight policy for a longer duration in order to meet its inflation target. In an interview with Fox Business, Atlanta Fed President Raphael Bostic stated that the Fed must continue to take a restrictive position and that the inflation forecast will decrease very gradually. New York Fed President John Williams also said that while inflation is currently too high, he thinks the present Fed policy is well-positioned to gradually return price increases to the Fed's target.

The safe-haven Silver weakens as investors might move toward other riskier assets after Israeli Prime Minister Benjamin Netanyahu's administration reluctantly accepted US President Joe Biden's proposal for a Gaza cease-fire on Sunday. According to the BBC, this decision was made in the midst of continuous attacks in Rafah as a result of strong Israeli bombings over the weekend.

XAG/USD

Overview
Today last price	30.25
Today Daily Change	-0.16
Today Daily Change %	-0.53
Today daily open	30.41

Trends
Daily SMA20	29.93
Daily SMA50	28.14
Daily SMA100	25.7
Daily SMA200	24.49

Levels
Previous Daily High	31.77
Previous Daily Low	30.19
Previous Weekly High	32.3
Previous Weekly Low	30.19
Previous Monthly High	32.51
Previous Monthly Low	26.02
Daily Fibonacci 38.2%	30.79
Daily Fibonacci 61.8%	31.17
Daily Pivot Point S1	29.81
Daily Pivot Point S2	29.21
Daily Pivot Point S3	28.23
Daily Pivot Point R1	31.39
Daily Pivot Point R2	32.37
Daily Pivot Point R3	32.97

Author

Akhtar Faruqui

FXStreet

Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.

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