Silver Price Forecast: XAG/USD starts US CPI week on flat note around $63.50
Silver price (XAG/USD) trades in a tight range at around $63.50 during the Asian trading session at the start of the week. The white metal struggles for direction but is close to an almost seven-week high of $65.16 posted on Friday.
On the first day of the week, the silver price (XAG/USD) traded in a narrow range around $63.50, hovering near an almost seven-week high of $65.16 reached on Friday. The upcoming release of the United States Consumer Price Index (CPI) data for July on Wednesday is expected to bring heightened volatility to the market, as it will have a significant impact on Federal Reserve interest rate expectations.
The Fed is highly concerned about high inflation and aims to bring price pressures down to the 2% target. A rise in US inflationary pressures raises the risk of Fed interest rate hikes, which is unfavorable for non-yielding assets like silver. Following the US Nonfarm Payrolls (NFP) data for July on Friday, traders reduced expectations of a Fed rate hike for the September meeting from 67% to 46%, as the labor force reduced.
Spot silver held above the 20-day Exponential Moving Average (EMA) at $60.14, indicating a bullish near-term bias. The immediate resistance level is last week's high at $65.16, with a break above this level potentially opening the way to further upside towards $70.00. Conversely, if the price fails to hold the dynamic barrier, it might return to its lowest low of $54.77 in the Year-To-Date (YTD).
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