17.06.202619:23:44UTC+00Silver Pulls Back After FOMC

Silver prices slipped back below the $70-per-ounce mark on Wednesday after the Federal Reserve left interest rates unchanged but signaled the possibility of further hikes this year. Half of FOMC members projected that additional rate increases could be appropriate in 2024, as they expect core inflation to remain elevated and the labor market to stay robust. This outlook weighed on fixed-income assets and raised the opportunity cost of holding non-yielding bullion compared with coupon-bearing securities.

Adding to the pressure, Fed Chairman Warsh announced the formation of multiple task forces to assess potential changes to the Federal Reserve’s monetary framework, including a smaller balance sheet. Those discussions further undermined bonds and, by extension, precious metals.

At the same time, datacenter operators and AI infrastructure firms continued to raise capital to expand computing capacity, strengthening the demand outlook for industrial silver. The metal is also set to play a role in Chinese spending on energy storage projects, providing an additional source of support on the demand side.