Silver price (XAG/USD) remains stable with a positive outlook, it may extend its winning streak for the third consecutive day. The XAG/USD pair trades around $29.10 per troy ounce during early European hours on Monday. The non-yielding asset gains ground as investors assess the Federal Reserve's (Fed) monetary policy outlook amid signs of cooling US inflation.
On Friday, the US Bureau of Economic Analysis reported that US inflation had eased to its lowest annual rate in over three years. The US Personal Consumption Expenditures (PCE) Price Index increased by 2.6% year-over-year in May, down from 2.7% in April, meeting market expectations. Meanwhile, Core PCE inflation also rose by 2.6% year-over-year, down from April's 2.8% reading, aligning with estimates.
On Friday, Federal Reserve Bank of San Francisco President Mary Daly stated that while monetary policy is proving effective, it is still too early to determine when it will be appropriate to cut interest rates. Daly remarked, "If inflation stays sticky or comes down slowly, rates would need to be higher for longer," according to Reuters.
Demand uncertainties in China, the largest consumer of Silver, also pressured prices after an official report indicated a second consecutive month of manufacturing downturn in June. China's National Bureau of Statistics (NBS) reported that the Manufacturing PMI remained at 49.5 in June, consistent with market forecasts and marking the fourth instance of contraction.
Conversely, a private survey indicated the fastest growth in the manufacturing sector in three years. The Caixin Manufacturing PMI for China rose to 51.8 in June, defying expectations of a decline to 51.2 from May's 51.7.
Source : Fxstreet
