Tuesday, 05 August 2025
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Silver Price Forecast: XAG/USD Steady Near $37.50 Amid Growing Chances Of A Fed Rate Cut
Tuesday, 5 August 2025 10:18 WIB | SILVER |PerakSILVER

Silver prices (XAG/USD) traded slightly after rising in the previous two sessions, trading around $37.50 per troy ounce during the Asian session on Tuesday (August 5). This non-yielding silver could attract buyers amid growing expectations of a rate cut by the US Federal Reserve (Fed) in September.

According to the CME FedWatch Tool, the market is pricing in a 91.6% chance of a Fed rate cut next month, driven by weaker labor market data that has raised concerns about the US economic outlook.

Federal Reserve Bank of San Francisco President Mary C. Daly said Monday evening that while there are many reasons to begin considering a rate cut, there remains considerable uncertainty, making it difficult for Fed officials to act too quickly. "We can't wait to ensure there's no sustained inflation; we need to make decisions based on what's most likely," Daly added.

Furthermore, demand for silver as a safe-haven asset is likely to strengthen amid growing concerns over the independence of the Federal Reserve (Fed). US Federal Reserve Chair Adriana Kugler has unexpectedly resigned, giving US President Donald Trump an earlier-than-anticipated opportunity to influence the central bank. This situation allows Trump to appoint a replacement who may be more in line with his call for lower interest rates.

Silver prices are likely to be supported amid rising trade uncertainty, as Trump's latest round of tariffs on exports from various trading partners is scheduled to take effect on August 7. Additionally, traders will be keeping an eye on the US ISM Services PMI, due to be released later Tuesday, with expectations for an increase to 51.5 in July from 50.8 previously. (alg)

Source: FXstreet

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