FX.co ★ Silver Set for Solid Monthly Gain

Silver hovered around $38.8 per ounce on Friday and is poised to gain approximately 6% for the month of August. This uptrend is fueled by a declining dollar and falling Treasury yields as investor speculation increases about upcoming Federal Reserve rate cuts. Fed Governor Christopher Waller announced on Thursday evening his support for initiating rate cuts next month and expressed his expectation for continued reductions to bring the rates nearer to a neutral level. The markets are currently reflecting an 86% probability of a 25 basis-point cut in September, with a further rate adjustment expected before the year's end. Investors are also keeping a close watch on the latest U.S. Personal Consumption Expenditures (PCE) price index, the Federal Reserve’s preferred inflation measure, for further insights into policy direction. On the industrial front, silver demand has been bolstered by positive indicators from China’s photovoltaic industry. Recent data revealed that Chinese solar cell exports increased by over 70% in the first half of the year, primarily driven by strong demand from India.