Silver traded above $77 per ounce on Thursday, holding on to gains after climbing nearly 5% in the previous session, as the broader metals complex rebounded despite a stronger US dollar and hawkish signals from the Federal Reserve.
The rally comes even as robust US economic data supported the greenback. Typically, a firmer dollar weighs on precious metals, but silver found support from positioning adjustments and broader market resilience.
Fed minutes send mixed signals
Minutes from the Federal Reserve’s January meeting showed policymakers remain divided on the future path of interest rates. Some officials suggested that rate cuts could become appropriate if disinflation continues, while others favored keeping rates elevated for longer. A few even flagged the possibility of further tightening if inflation proves persistent.
Following the release, traders slightly pared back expectations for aggressive easing this year. However, markets are still pricing in two 25-basis-point rate cuts before year-end, keeping the broader outlook supportive for non-yielding assets like silver.
Geopolitical risks add support
Precious metals also drew strength from rising geopolitical tensions. The United States has increased its military presence in the Middle East amid concerns over potential conflict with Iran. Meanwhile, peace talks between Ukraine and Russia ended without a breakthrough, sustaining uncertainty.
The combination of policy uncertainty, geopolitical risks and recent dip-buying has helped silver remain elevated, even as currency and bond markets adjust to evolving expectations around US monetary policy.