Silver prices surged into uncharted territory this week, closing at a historic peak as disappointing U.S. economic data dramatically increased bets on imminent interest rate cuts. The rally has shifted market focus squarely onto the Federal Reserve’s upcoming policy decision.

Key Data Points from the Rally

• Closing Price: The metal settled at a robust $58.80 per ounce.
• Monthly Gain: Silver has advanced a substantial 22.85% over the past 30 days.
• Catalyst: The U.S. private sector unexpectedly reported a loss of 32,000 jobs for November.
• Market Implication: Traders now price in an 87% probability of a Fed rate cut next week.

Economic Data Ignites the Rally

The immediate catalyst for the surge was a weaker-than-expected U.S. jobs report. Contrary to forecasts, private sector employment contracted by 32,000 positions in November. This soft data places increased pressure on the Federal Reserve to act, with markets now overwhelmingly anticipating a supportive rate reduction.

This environment is ideal for non-yielding assets like silver. Lower interest rates typically weaken the U.S. dollar and reduce the opportunity cost of holding precious metals. The result was a flight into tangible assets, pushing the spot price up 2.21% on Friday alone.

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A Global Support System

The bullish momentum is not solely a U.S. story. Supportive policy from a key global buyer is adding further fuel. On Friday, the Reserve Bank of India (RBI) cut its benchmark interest rate by 25 basis points to 5.25%. As one of the world’s largest consumers of physical silver, cheaper financing in India is expected to stimulate additional demand for both jewelry and industrial metal.

This combination of dovish Fed expectations and Asian demand stimulus creates a powerful, broad-based support level for the price. From a technical perspective, the metal is trading in an extremely bullish environment, now just 0.59% below its 52-week high of $59.15, with no immediate resistance in sight.

All Eyes on the Federal Reserve

The upcoming week is poised to be decisive for silver’s near-term trajectory. Should the Federal Reserve confirm market expectations and lower rates, the U.S. dollar could face further pressure, granting silver additional upward momentum. Market positioning leaves little doubt: participants are betting on accommodative monetary policy as the next major catalyst for the precious metal.

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