Silver (XAG) Forecast: CPI Report Could Break Stalemate in Silver Market

Silver Stalls Ahead of CPI as Traders Brace for Volatility

Silver prices are drifting lower on Friday, with spot XAG/USD last seen trading below $49 following a failed rally attempt near $49.46. The market remains locked in a tight range, with this week’s low at $47.53 still intact. The price action reflects rising uncertainty ahead of the U.S. Consumer Price Index (CPI) release, a key macro event that could influence Fed policy and shape metal markets in the near term.

At 11:24 GMT, XAG/USD is trading $48.01, down $0.91 or -1.85%.

Silver Consolidates as Bulls and Bears Stand Off

Thursday’s intraday reversal below $49.46 has capped upside for now, while support at $47.53 continues to hold. The narrow range suggests traders are sidelined, awaiting a catalyst. A breakout above $49.56 could force short-covering and drive silver toward a pivot zone at $51.01. Conversely, a break below $47.53 opens the door to the 50-day moving average at $44.44—an area likely to attract value-driven buyers.

Traders remain split between two camps: momentum buyers looking for confirmation above $49.56, and dip buyers eyeing pullbacks toward the mid-$44 range. With inflation data imminent, conviction is limited.

Gold Retreats as Dollar Strength and Yields Apply Pressure

Silver’s indecisiveness mirrors developments in the gold market, which has come under pressure after failing to extend beyond the $4192.86 resistance. Spot gold hit a record high of $4181.21 earlier in the week but has since fallen below the $4100.43 pivot. The U.S. dollar index is up 0.6% this week, and Treasury yields continue to firm, with the 10-year note touching 4.012%—both bearish for precious metals in the short run.

Gold’s weakness signals a broader pullback across metals, driven by profit-taking, easing geopolitical risk, and doubts over the Fed’s rate cut path. Headlines that President Trump and President Xi will meet next week have reduced trade-related tail risk, removing one of the recent bullish drivers for metals.

CPI Data Could Be the Tiebreaker for Silver Bulls

All eyes are now on the September CPI report due at 1230 GMT. Consensus expects a 0.4% rise in headline inflation and 0.3% for the core. A stronger-than-expected print would likely firm the dollar and yields further, putting pressure on silver and gold alike. However, traders are still pricing in a 99% probability of a 25 basis point rate cut at next week’s FOMC meeting, keeping longer-term support intact.

Silver Price Outlook: Volatility Looms Below $49.56

With silver failing to break $49.56, the near-term tone leans bearish. A breach of $47.53 could accelerate selling into the $44.44 zone. However, strong CPI data or dovish Fed language next week could reverse the bias quickly. Until then, traders should prepare for a breakout from the current range as volatility builds.

More Information in our Economic Calendar.