Silver price rebounds ahead of expected Fed rate hike, Warsh press conference

Silver prices surged ahead of the Federal Reserve's expected interest rate increase, hitting $64.00 per troy ounce. Investors adjusted their positions in anticipation of the Fed's monetary policy decision, scheduled for 18:00 GMT. The anticipated 25-basis-point hike would bring the federal funds rate target to 3.75%-4.00%, marking the first increase since July 2023.

Persistent inflation, driven by energy price shocks from the Middle East conflict, and the resilience of the US economy have fueled expectations of tighter monetary policy. US Retail Sales grew 1.2% MoM in August, surpassing forecasts for a 0.8% increase. Silver's response will depend on the Fed's communicated guidance and Chairman Kevin Warsh's press conference at 18:30 GMT.

The CME FedWatch Tool indicates a 79% probability of at least two rate hikes by year-end. Higher interest rates could benefit US Treasury yields and the US Dollar, negatively impacting Silver's upside potential. Silver's current price ($64.46) is above the 100-hour SMA ($63.88) but below the 200-hour SMA ($65.18), signaling mixed momentum.

Technical analysis suggests support at $64.30 and resistance at $64.95, with potential for further price movement if the metal holds above these levels.