Fed's dovish stance provides relief for silver prices, analysts say

Silver markets have found some respite following dovish signals from the U.S. Federal Reserve, which have reduced immediate selling pressure on the precious metal. Analysts point to the central bank's more accommodative stance as a key factor supporting prices in recent trading.

Mirae Asset Sharekhan identified $65 per troy ounce as a critical support level for silver as investors digest the Fed's messaging. The dovish commentary has shifted sentiment away from aggressive rate hike expectations, providing breathing room for commodity markets that had faced headwinds from higher interest rates.

However, several structural challenges continue to weigh on the silver market outlook. China's substantial inventory levels remain a concern for price discovery, while London Bullion Market Association lease rates continue to reflect subdued demand. Exchange-traded fund flows have also remained sluggish, suggesting investor appetite for silver exposure remains limited despite the Fed's shift in tone.

Analysts caution that while the Fed's dovish messaging provides near-term support, silver investors must monitor developments in Chinese physical demand, lease rate movements, and institutional investment flows to gauge the metal's trajectory in coming weeks.