Silver (XAG/USD) price prediction is one of the hardest nuts to crack due to extreme volatility this year. After a sharp sell-off throughout 2022, the precious metal prices rebounded in 2023. Gold and Silver prices dropped once again in May and have been in the midst of a recovery since then.
Due to the rising strength of the US dollar, Silver price per ounce is having a major pullback. The price is currently trading 14% below its yearly peak. The increase in 10-year yield is also causing headwinds for the precious metals as investors move their capital from volatile assets.
What Is Silver?
Silver belongs to a category of metals that are considered very precious due to its wide range of uses and its preference as a store of value. For thousands of years, human civilizations have used Gold and Silver as primary means to exchange and store value. As a result, Silver price has always remained tied to economic activity worldwide.
The XAG/USD keeps track of the price of Silver in terms of the United States dollar. Therefore, the pair generally shows an inverse correlation to the strength or weakness of the greenback.
Silver Price Latest News
The August 2023 CPI data showed that the MoM core inflation came at 0.3% against the forecast of 0.2%. The YoY CPI inflation, which was expected to be 3.6%, also stayed above expectations and remained at 3.7%. This unexpected rise in inflation could be attributed to the soaring oil prices and might turn US Fed more hawkish in the coming weeks.
The Federal Reserve of the United States hiked the interest rates by 25 basis points in July 2023 once again. This resulted in a strong rebound in the DXY index, which tracks the strength of the US dollar against five foreign currencies. Consequently, the Silver price started to correct as the investors rushed to the dollar for safety.
However, the precious metals are recovering significantly as the latest data suggests that the job market is weakening. Gold price has also rebounded after bouncing off a critical trendline. Nevertheless, the Fed Chair and a majority of the FOMC members remain inclined towards more rate hikes.
XAG/USD Tumbles Ahead Of FOMC
The FOMC meeting is scheduled for 19-20 September 2023. The outcome of the meeting will be very critical for the markets. As per the CME Fed Watch Tool, there is a 97% probability of the rates staying the same after the FOMC meeting. Due to this reason, equity markets remained resilient despite an unexpected uptick in inflation.
Silver Price Chart – XAG/USD
The following XAG/USD chart reveals that after a strong sell-off last year, Silver price per ounce rebounded very strongly. The price bottomed out at around $17.50 in September and started to rise. Since then, the price of Silver has been up 32%.
Silver Price – Historical Chart
Silver Price Prediction 2023
After a strong rebound in August, XAG/USD has slid almost 10% in September 2023. The XAU/USD pair is also showing a similar downtrend. The price has also broken below the upward trendline on the daily chart. Bears may target another retest of the $22 demand zone in the coming days.
I predicted this drop in precious metal prices in my last Silver price forecast. I also regularly update the price targets on my Twitter, where you are welcome to follow me.
Silver Price Prediction 2025
Due to the high inflation and increased interest rates, analysts are predicting the US economy will enter a recession later in 2023. If this really happens, then the Silver and Gold price may increase as they are the preferred store of value across the world. A simple pitchfork analysis gives us a Silver price forecast for 2025 between $34-$50.
Silver Price Prediction 2030
A lot can happen in the world till 2030. Considering the current state of the global economy and the inflation across the world, I’d be surprised if Silver doesn’t make a new all-time high within the next seven years. Therefore, XAG/USD may break above its 2011 all-time high of $50. However, close attention must still be given to the changing global macroeconomic scenario.
Silver Price Prediction 2040
While the Silver price prediction 2040 is anybody’s guess, we can still consider a few different scenarios. If the US dollar remains the global reserve currency within the next two decades, Silver can comfortably trade above $50 by 2040. Technical analysis also gives a price range of $78-$138.
Where To Buy Silver?
You can buy silver on brokers like IG, TD Ameritrade, Interactive Brokers, Capital.com, Exness, etc. These brokers allow you to trade the XAG/USD pair by adding very little margin. However, you must learn risk management before taking leveraged positions on any asset.
How To Trade Silver?
Nowadays, there are various ways to gain exposure to the volatility in precious metals. Holding silver physically involves additional costs. Therefore, the best way is to invest in Silver CFDs or futures contracts via an online broker like eToro, Exness, TD Ameritrade, etc.
What is The Spot Price Of Silver?
As the name suggests, Silver spot price is the price of the bullion coins for immediate delivery. The current spot price is $24.75, but it is very volatile as it trades almost 24 hrs across the world wherever the markets are open. The biggest trading volume comes from US, UK, Japan, Hong Kong etc.
Concluding Remarks
Investing in precious metals like Gold and Silver is always worth considering as they are a time-tested store of values with plenty of uses across the modern industry. However, the biggest factor is to evaluate your investment objectives and the time horizon. If you don’t want exponential returns and simply want to hedge against inflation, Gold and Silver could be one of the great options.