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XAG/USD Surges To 14-Year High Above $48.50 Amid Fed Rate Cut Speculation And US Economic Turmoil
Wednesday, 8 October 2025 16:14 WIB | SILVER |PerakSILVER

Silver prices (XAG/USD) rose to around $48.65 in early European trading on Wednesday (October 8th). The metal strengthened slightly, approaching a 14-year high amid growing expectations of a Fed rate cut and the ongoing US government shutdown.

The US government shutdown entered its eighth day on Wednesday. The increased level of uncertainty could drive safe-haven inflows, supporting silver prices. US President Donald Trump said on Tuesday that his administration plans to lay off federal employees if the shutdown continues beyond Monday, adding that he would provide details on the layoffs in the next four or five days.

The government shutdown has delayed the release of US Nonfarm Payrolls (NFP) data, forcing investors to rely on secondary data to gauge the timing and extent of a Fed rate cut. Investors currently expect a 25 basis point (bps) interest rate cut at the Fed's October meeting, with an additional 25 bps cut anticipated in December. Lower interest rates could reduce the opportunity cost of holding silver, thus supporting the non-yielding precious metal.

Investors will closely monitor the FOMC Minutes on Wednesday for further information on the outlook for US interest rates. Additionally, Federal Reserve officials are scheduled to speak. Hawkish comments from Fed policymakers could support the US dollar (USD) and weigh on USD-denominated commodity prices in the near term. (alg)

Source: FXstreet

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