Silver prices jumped 2% on Monday to above $40 per ounce, their highest level since September 2011, as markets bet firmly on an imminent U.S. Federal Reserve rate cut.
San Francisco Fed President Mary Daly signaled Friday that the central bank is prepared to ease borrowing costs in response to labor market risks, stressing that tariff-driven inflation may be temporary. Traders now see an 88% chance of a 25 basis point cut at the upcoming Fed meeting, even after the Fed’s preferred PCE inflation gauge showed prices climbing.
Beyond monetary policy, industrial demand is adding strong support to silver’s rally. China’s booming solar sector has driven solar cell exports up more than 70% in the first half of the year, with India leading the surge in orders. Analysts say this combination of safe-haven buying and industrial use is reinforcing silver’s breakout above $40.
