Silver concluded the trading session with a gain of 1.15%, reaching Rs 2,34,786. This increase was bolstered by a weaker dollar and declining oil prices, as market participants looked ahead to the Federal Reserve’s interest-rate decision for additional guidance. The Federal Reserve unanimously raised the federal funds target range by 25 basis points to 3.75%-4.00% in September 2026, marking its first rate hike since 2023. Policymakers noted that inflation remains elevated, and this move is aimed at supporting a timely return toward the 2% target.
Updated projections indicated that 16 of 18 officials perceive the potential for at least one more 25-basis-point increase this year, with four anticipating two additional hikes, thereby maintaining monetary policy as a significant influence on precious metals. US retail sales experienced a month-on-month increase of 1.2% in August, marking the most significant rise in four months. Concurrently, export prices rose by 0.6%, and import prices saw a climb of 0.7%, suggesting ongoing price pressures in the economy. Crude oil prices experienced a decline following an unforeseen increase in US inventories, coupled with reports indicating that Saudi Arabia was providing additional crude to Asian refiners via ship-to-ship transfers off the coast of Oman, thereby alleviating worries regarding potential supply disruptions in the Middle East.
COMEX silver speculators raised net longs by 2,006 contracts to 14,176 for the week ended September 8, reflecting enhanced speculative positioning. London vault holdings reached 28,213 tonnes at the end of July, reflecting a month-on-month increase of 0.5% and valued at $52.7 billion, which is roughly equivalent to 940,423 silver bars. The silver market is approaching its sixth consecutive year of structural deficit, having seen 762 million troy ounces withdrawn from stocks since 2021, thereby heightening the risk of renewed liquidity constraints. The global deficit is anticipated to expand to 46.3 million ounces in 2026, up from 40.3 million ounces in 2025, even as total demand is expected to decrease by 2%, alongside a forecasted 2% decline in supply.
Industrial fabrication is projected to decrease by 3%, while demand for coins and bars may increase by 18%. Technically, silver continues to experience short covering, evidenced by a 7.96% decline in open interest to 12,504, while prices increased by Rs 2,668. Support is positioned at Rs 2,33,560, with a breach below indicating an opening at Rs 2,32,330, while resistance is identified at Rs 2,36,060. A movement above this level could lead prices to test Rs 2,37,330.
