Silver (XAG) Forecast: CPI Data and Fed Cuts in Focus as Silver Surges Past Multi-Year Highs

Silver Surges Past Multi-Year Highs as Gold Lingers Near Key Support

Silver extended its rally into a third consecutive session on Monday, gaining strength from its recent breakout above multi-year resistance levels at $34.87 and 35.40. With those levels now acting as support, silver continues to outperform gold and is attracting bullish flows as traders target the psychologically significant $37.00 and $38.00 levels in the near term.

At 13:02 GMT, XAG/USD is trading $36.31, up $0.33 or +0.93%.

Fed Outlook and CPI in Focus—What It Means for Precious Metals

While gold remains rangebound near key technical support at $3310.48, silver is benefiting from the same economic drivers but delivering stronger price action. Markets are awaiting Wednesday’s U.S. Consumer Price Index (CPI) release for insights on inflation trends and implications for the Federal Reserve’s rate path. The Fed is currently in its pre-meeting blackout period, but the market has scaled back expectations for rate cuts this year—from two to just one—likely in October.

Treasury yields eased slightly ahead of the CPI data, with the 10-year at 4.504% and the 2-year yield at 4.02%. Lower yields tend to support precious metals by reducing the opportunity cost of holding non-yielding assets like silver and gold.

US-China Trade Talks Support Risk Sentiment—and Silver Demand

Renewed optimism over a potential U.S.-China trade agreement is adding to silver’s bullish case. Top U.S. officials are in London meeting with China’s Vice Premier He Lifeng, and while no breakthroughs are expected, the talks have fostered a modestly risk-on tone. If a deal materializes, industrial demand for silver could rise, particularly from sectors like electronics and solar, where silver is a key component. Traders are already positioning for increased usage.

Dollar Weakness Adds Tailwind

The U.S. dollar index slipped 0.3% to 98.92, lending additional support to silver. A weaker dollar makes dollar-denominated assets more attractive to overseas buyers. With gold struggling to hold gains below its $3403.63 resistance, silver is stepping in as the precious metal of choice in current market conditions.

Silver Outlook: Bullish Momentum May Extend Toward $38.00

Technical strength, supportive economic signals, and a favorable gold/silver ratio are all working in silver’s favor. With the 50-day and 200-day moving averages far below at $32.90 and $31.73 respectively, silver has plenty of room to run without facing significant resistance.

Unless CPI data surprises to the upside, silver’s momentum suggests the $37.00–$38.00 range is within striking distance this week.

More Information in our Economic Calendar.