FX.co ★ Silver Retreats after Record Rally

Silver prices dipped below $62 per ounce on Friday, following a record-setting session earlier in the day. This downturn was driven by profit-taking and a brief period of consolidation as the weekend approached, despite the ongoing optimistic market sentiment. The recent interest rate reduction by the US Federal Reserve, coupled with its less aggressive forecast, continued to offer medium-term support. Federal Reserve Chair Jerome Powell indicated that no further rate hikes are expected, with projections suggesting one additional rate cut next year and another in 2027. Strong inflows into Exchange Traded Funds (ETFs) and robust retail purchasing predicated expectations of a market shortage in the coming year. Additionally, industrial demand driven by the solar industry, electric vehicles, and data center infrastructure sustained upward pressure on silver's fundamental value. Concurrently, increasing lease rates and heightened borrowing costs for physical silver in London highlighted sustained challenges in meeting delivery obligations.