August CPI data’s month-over-month increase abruptly widened from 0.1% in July to 0.4%, with the year-over-year figure of 3.4% landing in line with expectations. Core CPI year-over-year inched down slightly to 2.4%. The data itself is a mixed bag, but the renewed acceleration in the month-over-month rate is enough to make traders start questioning whether the FOMC on September 16 will truly cut rates as scheduled.
It’s also worth noting that silver spot is currently around $65.02 per ounce, up only 0.14% over the past 24 hours—far less than gold’s 0.89% gain. Risk-off buying has clearly favored gold over silver. Moreover, silver’s industrial attributes (which are more sensitive to economic slowdown) have turned into a drag amid rising expectations for tighter policy.
If next week’s rate decision signals a more hawkish stance than the market expects, this “caught in between” position for silver could be sold first. Investors are advised to keep a close watch and avoid chasing long positions blindly. #CPIWatch
It’s also worth noting that silver spot is currently around $65.02 per ounce, up only 0.14% over the past 24 hours—far less than gold’s 0.89% gain. Risk-off buying has clearly favored gold over silver. Moreover, silver’s industrial attributes (which are more sensitive to economic slowdown) have turned into a drag amid rising expectations for tighter policy.
If next week’s rate decision signals a more hawkish stance than the market expects, this “caught in between” position for silver could be sold first. Investors are advised to keep a close watch and avoid chasing long positions blindly. #CPIWatch