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Silver Price Forecast: Rebound Faces Fed Hike Risks Ahead of CPI

Silver Price Forecast: Rebound Faces Fed Hike Risks Ahead of CPI

By: 
Muhammad Umair

Key Points:

  • A strong US dollar continues to limit silver’s rebound.
  • US CPI data could drive the next move in silver prices.
  • A break above $65 would strengthen silver’s recovery.

Silver (XAG) prices rebounded on Friday, but a strong US dollar and concerns of persistent inflation continue to limit the recovery. The upcoming US CPI report could shape expectations for a rate hike in December and drive the next move in the dollar, Treasury yields and silver. The weak performance of silver relative to gold also calls for caution. In my view, a correction in the US dollar and a clear break above $65 in spot silver would strengthen the rebound. This article presents the key drivers, the outlook for the US dollar and key technical levels to understand the next move in silver prices.