XAG/USD falls to $63.50 after softer US PPI data reduces September Fed hike odds to 34.8%.
Silver prices extended declines for a second day, trading near $63.50 per ounce in Asian hours as investors took profits amid shifting Fed policy expectations. The move follows weaker-than-expected US wholesale inflation data, which showed flat growth in July versus a forecast 0.2% rise.
The Bureau of Labor Statistics reported headline PPI up 4.7% year-over-year, while core PPI rose 4.2%, both below prior prints. Markets now price a 34.8% chance of a September rate hike, down from 40% pre-release. Geopolitical risks in the Middle East also weighed on sentiment as diplomatic efforts to reopen the Strait of Hormuz stalled.
TD Securities noted strong CTA interest in silver as prices test key technical levels, though profit-taking pressure persists.