Silver experienced an increase of 1.4% yesterday, closing at 126,938, as investors absorbed new economic data from the United States that bolstered expectations for forthcoming rate cuts by the Federal Reserve. In the latest report, weekly jobless claims experienced a notable increase of 27,000, bringing the total to 263,000. Concurrently, consumer prices saw a rise of 0.4% in August, which is double the rate recorded in July and marginally exceeds analysts’ forecasts.
This increase has elevated annual inflation to a seven-month peak of 2.9%, thereby introducing additional intricacies to the Federal Reserve’s forthcoming decisions. The announcement followed an unforeseen drop in producer prices earlier in the week, which has intensified anticipations regarding a potential relaxation of monetary policy. Geopolitical tensions have persistently enhanced silver’s allure as a safe-haven asset. The President of the United States, Donald Trump, has urged the European Union to implement tariffs on both China and India as a means to exert pressure on Russia in relation to the ongoing conflict in Ukraine. Concurrently, Poland has reported the successful interception of Russian drones amidst a significant assault in western Ukraine.
In the industrial sector, strong demand stemming from solar energy, electric vehicles, and electronics has maintained a tight physical silver market, constrained by supply limitations. In the first half of 2025, China’s solar cell exports experienced a remarkable increase of more than 70%, primarily fueled by shipments to India, which in turn bolstered near-term physical offtake. In the first half of 2025, investments in silver exchange-traded products (ETPs) experienced remarkable inflows, totaling 95 million ounces, thereby exceeding the cumulative inflows recorded for the entire previous year. From a technical perspective, the market is experiencing new buying activity, as evidenced by an increase in open interest of 7.64%, reaching a total of 18,583 lots.
Immediate support is positioned at 125,280, with a potential examination of 123,620 should further weakness materialize. Resistance is positioned at 127,920, and a sustained movement above this threshold could propel prices toward 128,900, indicating a persistent bullish momentum supported by favorable fundamentals.