Silver prices fell over 2% to $52.20 after Fed Governor Waller suggested a 0.5% rate hike in December is possible if October core CPI hits 0.3%, bolstering the US Dollar above 101.70.
Silver is already down over 2% to near $52.20 after Fed Governor Waller warned a half-point December rate hike may be needed if October core CPI comes in at 0.3% or higher. Higher rates reduce the appeal of non-yielding assets like silver. Price also sits below the 20-day EMA at $54.07 with RSI around 40, confirming bearish near-term momentum.
Waller's warning of a possible half-point December rate hike if core CPI is 0.3% or higher supports a hawkish Fed path, lifting the dollar: DXY clawed back early losses and turned marginally positive above 101.70. The outcome of today's 13:30 GMT CPI (consensus 0.2%) will decide whether the move extends.
Silver prices dropped over 2% to $52.20 as Fed Governor Christopher Waller warned that a half-point rate hike may be required in December if October core CPI reaches 0.3% or higher. The US Dollar Index recovered to trade above 101.70 following the hawkish remarks, while market participants await the official CPI data release at 13:30 GMT.
Fed Governor Waller said a half-point rate hike may be needed in December if October core CPI is around 0.3% or higher, and expectations of aggressive tightening make non-yielding assets like silver less attractive, pushing the price down over 2% to near $52.20.
A softer-than-expected October CPI print (consensus is 0.2% versus 0.3% previously) would reduce fears of a bigger rate hike, and technically a daily close above the 20-day EMA at $54.07 would be needed to ease downside pressure.
Fed Governor Waller warned that further tightening is needed and did not rule out a larger rate hike, possibly half a point in December if October core CPI is around 0.3% or higher. Following the remarks, the Dollar Index recovered early losses and turned positive above 101.70.
Today's consensus is 0.2%. Waller tied the half-point hike scenario to core CPI around 0.3% or higher, so an in-line 0.2% print would weaken the case for a bigger December hike and could take support away from the dollar.