Impact of U.S. Monetary Policy on Silver Prices
The anticipation of reduced U.S. interest rates has traditionally favoured silver, as lower yields on bonds make non-yielding assets more attractive.
This scenario is underscored by the Fed’s recent indications that it might lower borrowing costs sooner than later if inflation targets are approached sustainably.
Political Events Influencing Market Sentiment
The recent failed assassination attempt against Donald Trump has potentially increased his chances of election success in 2024, fostering expectations of a less regulated market environment.
While this might boost general market sentiment towards riskier assets, it could also temper gains for traditional safe havens like silver, especially if regulatory constraints are minimized.
Dollar Strength and Market Movements
Despite a modest strengthening of the U.S. dollar, influenced by projections of growing government debt and inflation under potential future Trump policies, silver has maintained its upward trajectory.
However, the stronger dollar could limit substantial gains in silver prices as it increases the cost of commodities priced in USD for foreign investors.