Silver Dropped With Investors Keenly Awaiting Fed’s Minutes.

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Silver Dropped With Investors Keenly Awaiting Fed’s Minutes.

Silver prices exhibited a decline of -0.91%, settling at 70609, as investors eagerly awaited the minutes of the recent U.S. Federal Reserve policy meeting to gain insights into the potential timing of interest rate cuts. The minutes revealed that the majority of policymakers at the Fed expressed concerns about the risks associated with premature interest rate cuts, emphasizing the uncertainty regarding the duration of maintaining the current restrictive monetary policy stance to achieve the Fed's 2% inflation target. Recent warmer U.S. inflation reports have led the market to believe that the Fed may delay any interest rate cuts until the second half of the year, or even later. 

Geopolitical tensions added to market concerns, with reports indicating ongoing attacks by Houthi rebels on ships in the Red Sea. Bank of England Governor Andrew Bailey expressed comfort with investors betting on interest rate cuts in the UK this year. Despite raising the Bank Rate to 5.25% in August 2023 to address surging inflation, the BoE has refrained from further hikes, citing ongoing economic uncertainties. The market is pricing in a quarter-point reduction fully for August, highlighting the cautious approach adopted by the BoE amid inflation concerns. 

From a technical standpoint, the silver market indicates fresh selling, marked by a 0.36% increase in open interest, settling at 21,990. Prices witnessed a notable decline of -646 rupees. Support for silver is anticipated at 70280, with potential testing of 69945 levels. On the upside, resistance is likely at 71205, and a breakout above could lead to further testing at 71795 levels.

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