Silver prices fell back to $38.80/oz in the short term, with the market focusing on the Fed's interest rate cut prospects and the US dollar trend.
2025-08-29 13:44:19
Silver prices (XAG/USD) dipped to $38.80/oz in early European trading, down approximately 0.52% on the day. Silver came under pressure from a stronger dollar and some profit-taking, but the market remained cautiously optimistic about the possibility of a Federal Reserve rate cut in September.
Investors will be watching the U.S. personal consumption expenditures (PCE) price index report for July, which will provide new directional guidance for silver prices.
Revised data from the U.S. Department of Commerce showed that the annualized GDP growth rate in the second quarter of 2025 reached 3.3%, higher than the previous estimate. This data supported the strengthening of the U.S. dollar in the short term and to some extent reduced the pressure on the Federal Reserve to cut interest rates immediately, thus putting pressure on dollar-denominated silver.
Despite this, recent weak U.S. employment data has the market still betting that the Federal Reserve may cut interest rates at its September meeting. John Williams, president of the New York Fed, said that interest rates may fall in the future, but further data is needed to determine whether a rate cut is appropriate.
The interest rate cut will reduce the opportunity cost of holding non-yielding assets such as silver, which is beneficial to the medium- and long-term performance of silver.
The daily silver price chart shows a clear short-term correction trend after falling from a high of $39.50 to around $38.80. The price remains above the 21-day EMA, and the short-term moving averages are in a bullish pattern, indicating that the overall bullish trend is intact. However, the RSI has fallen to around 47, suggesting that the correction momentum is accumulating.
The key support levels below are 38.50 and the 50-day EMA around 38.30; the upper resistance levels are $39.30 and $39.80 respectively. After breaking through, the rebound trend may be restarted.
Editor's opinion:
Silver's recent price action reflects the dual oscillation between the US dollar and Federal Reserve policy expectations. In the short term, if support at $38.50 holds, silver prices are expected to return to $39.30 or even $39.80. If support falls below, a further correction to $38.30 or lower is possible. In the short term, investors should monitor support and resistance levels and consider US PCE data to determine the market's short-term direction.
Investors will be watching the U.S. personal consumption expenditures (PCE) price index report for July, which will provide new directional guidance for silver prices.
Revised data from the U.S. Department of Commerce showed that the annualized GDP growth rate in the second quarter of 2025 reached 3.3%, higher than the previous estimate. This data supported the strengthening of the U.S. dollar in the short term and to some extent reduced the pressure on the Federal Reserve to cut interest rates immediately, thus putting pressure on dollar-denominated silver.
Despite this, recent weak U.S. employment data has the market still betting that the Federal Reserve may cut interest rates at its September meeting. John Williams, president of the New York Fed, said that interest rates may fall in the future, but further data is needed to determine whether a rate cut is appropriate.
The interest rate cut will reduce the opportunity cost of holding non-yielding assets such as silver, which is beneficial to the medium- and long-term performance of silver.
The daily silver price chart shows a clear short-term correction trend after falling from a high of $39.50 to around $38.80. The price remains above the 21-day EMA, and the short-term moving averages are in a bullish pattern, indicating that the overall bullish trend is intact. However, the RSI has fallen to around 47, suggesting that the correction momentum is accumulating.
The key support levels below are 38.50 and the 50-day EMA around 38.30; the upper resistance levels are $39.30 and $39.80 respectively. After breaking through, the rebound trend may be restarted.
Editor's opinion:
Silver's recent price action reflects the dual oscillation between the US dollar and Federal Reserve policy expectations. In the short term, if support at $38.50 holds, silver prices are expected to return to $39.30 or even $39.80. If support falls below, a further correction to $38.30 or lower is possible. In the short term, investors should monitor support and resistance levels and consider US PCE data to determine the market's short-term direction.
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