On Thursday, Silver started its trades with a bullish tendency, as the FED statement and Fed chair, Powell's comments on upcoming policies were less hawkish than expected.
The US economy is technically in a recession!
US Dollar also lost in the first hours but later regained its losses and is now trading 0.2% higher at 106.50. At the time of writing, with a 6.4% gain, Silver is trading around $19.80. Gold also is up almost 1.8%, around $1,750.
While last night FED increased the rates by 0.75%, as was widely expected, it also signaled that another "usually large" interest rate hike might be appropriate in the September meeting. Besides the statement, Mr. Powell's comments about the acceptable condition of the labor market and the US economic power helped the positive market sentiment.
As a result, these comments and outlooks increased the pressure on the US dollar and bond yields to lift the Gold and Silver price. On the other hand, positive sentiment in the stock markets always encourages silver price as one of the most used industrial metals. Platinum jumped 0.33% in other precious metals, while palladium climbed 0.56%.
After Wednesday's FED meeting, Thursday, initial jobless claims, and US Q2 GDP numbers were in the spotlight.
The US Commerce Department published the latest GDP updates. According to the released numbers, the economy in the United States shrank by 0.9% to enter the US economy to a technical recession for the second quarter in row results are negative. These numbers increase the concerns among market participants. Since FED already has hawkish policies, even if it is less than some expectations, entering the recession can hit the economy harder.
On the other hand, while GDP numbers are technically and according to the traditional definition of recession, show that the economy is already in a recession, many economists are not looking at these numbers. The labor market is still strong in both created jobs, and available vacancies, which can confirm that economy can still save itself, and even if it sees a recession, it can be a soft landing, as FED expects.
With these estimates, market conditions do not look worse, so we can still count on Silver demand. From the technical point of view also, last two days rebound, reversed the trend to start an upward trend, after that price used to decrease for a while.