Spot silver traded in a narrow range during Asian trading hours on Tuesday (November 10), currently hovering around $53.20 per ounce. Investors are focusing on the US October Consumer Price Index (CPI) data. It is estimated that the overall US CPI rose faster year-on-year to 3.9%, higher than the previous 3.7%; the core CPI, excluding volatile food and energy items, is also expected to rise to 2.8%, compared to 2.6% previously. On a month-on-month basis, overall and core inflation are expected to remain at 0.3% and 0.2%, respectively.

Data Expectations: Year-on-year growth accelerates, month-on-month growth remains stable, divergence between annual and monthly rates.

Market expectations for the October CPI show a clear pattern: the year-on-year reading is expected to accelerate (around 3.9% overall and 2.8% core), while the month-on-month reading is expected to remain stable at 0.3% and 0.2%. It's important to note that due to the government shutdown in October 2025 resulting in missing data, the Bureau of Labor Statistics will not release official year-on-year figures this time; the aforementioned figures are only estimates from private institutions. This discrepancy means that the year-on-year increase largely reflects the base effect, rather than a renewed acceleration of price pressures in the current month. In the absence of an official annual rate anchor, the market will rely more on the month-on-month reading to determine the direction of immediate price pressures. For silver, a stable month-on-month figure suggests that marginal inflationary pressures remain manageable and will not significantly strengthen the Fed's hawkish stance in the short term; however, the accelerated year-on-year figure estimated by private institutions reminds the market that inflation is still far from the 2% target, limiting the Fed's room for easing. Traders therefore need to interpret the data within the framework of "monthly cooling" and "still high annually" to avoid being misled by a single dimension.

Interest rate hike expectations: A December rate hike has already been priced in, putting pressure on non-yielding silver.

Inflation data is expected to have a significant impact on Federal Reserve interest rate expectations. According to the CME FedWatch tool, traders are currently highly confident that the Fed will raise interest rates at its December policy meeting, with the probability at a high level. A higher interest rate environment naturally puts pressure on non-yielding assets such as silver, as the opportunity cost of holding silver increases. Silver is currently facing a rate hike expectation that has already been fully priced in. If the CPI meets expectations and the rate hike path remains unchanged, silver will lack new directional drivers, and its price is more likely to remain volatile. If the CPI is overheated, the rate hike expectation may be further strengthened, putting additional downward pressure on silver. Only if the CPI is significantly soft, causing a softening of the rate hike expectation, will silver be able to gain clear upward momentum. In other words, data that meets expectations is neutral to bearish for silver, and a real upward catalyst requires a downside surprise to trigger.

US Dollar Background: Falling oil prices and hopes for a US-Iran agreement weighed on the dollar, providing a buffer for silver.

The US dollar index was under pressure ahead of the release of US CPI data, as falling oil prices anchored global inflation expectations to some extent. Energy prices fell due to rising hopes for a US-Iran deal, weakening the dollar's safe-haven appeal and interest rate support. As of press time, the dollar index was trading around 101.60, continuing its decline from the previous day. The weaker dollar provided a buffer for silver, which is priced in US dollars. This contrasts with the interest rate hike expectations, which represent two opposing forces: a weaker dollar supports silver prices from a pricing perspective, while high interest rate hike expectations suppress silver from an opportunity cost perspective. The two forces have temporarily balanced around $53, which is a key reason for silver's recent consolidation. After the data is released, which force prevails will determine whether silver can break out of its current consolidation range. If the dollar weakens further due to inflation data, silver's buffer will expand; conversely, if stronger interest rate hike expectations lead to a dollar rebound, silver's upside potential will be squeezed.

in conclusion

Spot silver was flat around $53.20 ahead of the US CPI release. The market expects overall CPI to rise 3.9% year-on-year (previous 3.7%) and core CPI to rise 2.8% (previous 2.6%), with month-on-month increases of 0.3% and 0.2% respectively. The year-on-year increase is accelerating while the month-on-month increase is stable, meaning the year-on-year rise partially reflects the base effect. However, in the absence of official annual rates, the market may rely more on month-on-month figures to determine immediate direction. Inflation data is expected to have a significant impact on the Fed's interest rate expectations, with traders currently confident of a December rate hike; higher interest rates are unfavorable for non-yielding silver. Meanwhile, the dollar is under pressure due to falling oil prices and hopes for a US-Iran agreement, holding steady around 101.60, providing a buffer for silver. These two forces are in equilibrium around $53: if the CPI is overheated, strengthened expectations of a rate hike will suppress silver; if it is weak, easing expectations of a rate hike may open up upside potential. (Spot silver daily chart, source: EasyTrade) At 14:26 Beijing time, spot silver was trading at $53.20 per ounce.