Silver price falls as Fed hawkish outlook drives US yields higher

Silver prices fell on Thursday, down 1.23% to approximately $63.65, as anticipation of aggressive Federal Reserve (Fed) actions prompted a surge in US Treasury yields. President of the New York Federal Reserve, John Williams, indicated a potential additional interest rate increase by year-end to combat inflation and return it to the 2% target.

This outlook amplified expectations of continued Fed tightening following the recent 25-basis-point rate hike. The CME FedWatch tool now projects a 71% likelihood of another rate hike at the October meeting, up from 55% a week prior. Consequently, US 10-year Treasury yields surged towards 5.15%, the highest since 2007, impacting Silver's value due to higher opportunity costs for non-yielding assets and a strengthening US Dollar.

Despite resilient US labor market data, initial jobless claims fell slightly, and continuing claims remained below expectations, suggesting no significant employment deterioration. Silver's price is currently trading at $63.61, under pressure from both the 100-period simple moving average ($65.77) and 200-period SMA ($64.90), supported by a band of resistance between $64.00 and $64.56.