World silver prices opened the new trading week with a positive upward trend in the context that the market continues to monitor interest rate, USD and geopolitical factors.
According to records at 8:50 am on September 21 (Vietnam time), world silver prices increased by 0.75%, to 66.62 USD/ounce. The price increase took place after the precious metal maintained its recovery momentum in the last session of last week, despite the high interest rate environment.
The market is still in a state of tug-of-war between two groups of factors. On the one hand, US bond yields and expectations of tight monetary policy continue to put pressure on precious metals. On the other hand, concerns about inflation, geopolitical instability and asset safe-haven demand are creating support for silver prices.
After the US Federal Reserve (Fed) decided to raise interest rates by another 0.25 percentage points, the benchmark interest rate was raised to the 3.75% - 4% range. The yield of 10-year US Treasury bonds returned to around 5%, while the USD showed signs of strengthening.
Usually, high interest rates and the rising USD will be detrimental to non-performing assets such as silver. However, recent developments show that cash flow in the market is still interested in precious metals in the context of investors reassessing long-term risks related to inflation, public debt and global economic prospects.
Technically, silver prices are currently trading above the 66 USD/ounce zone and continue to move towards the important resistance zone around 66.70 USD/ounce. If this zone is surpassed, the upward momentum may be strengthened with the next target around 68 USD/ounce. Conversely, not maintaining the current support zone may put pressure on silver prices to adjust.
