Silver surged more than 6% toward $83 per ounce on Monday, extending last week’s rebound after a historic selloff briefly wiped out nearly half its value. The recovery was underpinned by easing US inflation expectations, softer real yields, and a weaker dollar ahead of key US labor market and CPI data, which could reinforce expectations of Federal Reserve rate cuts later this year.
One-year-ahead US inflation expectations fell to 3.1%, while longer-term measures held steady, significantly reducing the real-rate headwind for non-yielding metals. Geopolitical factors offered additional, though secondary, support: negotiations between the US and Iran lowered the risk of immediate escalation, even as broader tail risks remained.
In Japan, a landslide election victory for Prime Minister Sanae Takaichi’s ruling coalition bolstered expectations of expansionary fiscal policy, adding further support to precious metals demand. Markets now turn to upcoming US employment and inflation releases for clearer guidance on the future policy path.
