Silver prices remained stable despite ongoing doubts about Fed's rate trajectory.
Silver closed with a resilient gain of 0.37% at 73,337, despite lingering uncertainty about the Federal Reserve's future rate decisions. The Federal Reserve chose to keep interest rates unchanged but remained open to potential policy tightening. This aligns with the trend of several global central banks opting for higher interest rates to curb inflation. The Japanese yen experienced a significant decline against the dollar as the Bank of Japan maintained its super-low interest rates and unchanged yield control policy, offering no clear indication of a policy shift.
Australian bullion demand saw a sharp decline for the second consecutive month in August, based on data from The Perth Mint of Australia. Sales of gold and silver products hit their lowest levels in over three and a half years. Minted silver coin and bar sales in August dropped by 8.2% from July and 52.1% from August 2022. Year to date, cumulative silver sales from the Perth Mint decreased by 27.5% compared to the same period last year.
From a technical perspective, the market displayed signs of short covering, with open interest dropping by -3.12% to 15,177 contracts. Silver found support at 72,950, with the potential for testing 72,570 levels. Resistance was identified at 73,745, and a breakout could lead to testing 74,160 levels.
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