Traders are also watching Fed Chairman Jerome Powell’s upcoming speech for more insight into the central bank’s outlook on interest rate policy.
Increase in Indian demand for silver is boosting prices
Indian silver demand has been a key factor in supporting prices this year. In the first four months of 2024 alone, imports reached 4,172 tons, more than the 3,625 tons imported in all of 2023.
The increase is largely attributed to the country’s growing solar energy initiatives, which have boosted production of solar cells and modules – key applications of silver.
India’s focus on domestic manufacturing to strengthen its supply chain and reduce dependence on imports from countries like China and Vietnam is also driving this demand.
The increased consumption of silver in industrial applications provides a stable base for metal prices and neutralizes fluctuations caused by global risk sentiment.
Chinese stimulus measures and the prospects for a US interest rate cut are shaping the outlook for silver
The recent decision by the People’s Bank of China (PBoC) to reduce reserve requirements for banks is expected to inject liquidity into the market, easing domestic financial conditions. Combined with the US Federal Reserve’s dovish outlook, these actions are likely to support silver prices in the near term.