FX.co ★ Silver Holds Near Record Highs

Silver continued to trade above $63 per ounce on Friday, remaining close to its all-time highs. This strength followed the latest rate cut by the US Federal Reserve, which coincided with increasingly tight conditions in the physical silver market. Earlier in the week, the Fed implemented a quarter-point reduction in rates, suggesting a less aggressive policy stance than previously anticipated by the markets. Chairman Jerome Powell signaled that further rate increases are improbable, with projections indicating one additional cut next year and another in 2027. The silver market was further bolstered by strong buying from exchange-traded funds (ETFs) and a solid retail demand that underscored expectations of a supply deficit in the coming year. The industrial sector, particularly industries like solar, electric vehicles, and data center infrastructure, also bolstered silver prices due to their significant demand. Additionally, increasing lease rates and borrowing costs for physical silver in London have pointed to real delivery stress rather than mere speculative activity.