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Bank of America expects inflation to remain above target, strengthening the case for the Fed to hold rates steady. The bank sees no cuts in the near term, contradicting market expectations for a potential reduction in July. Goldman Sachs also predicts further disinflation in areas like autos and housing but warns that tariff policies could counteract these effects.
Despite concerns, some surveys suggest inflation expectations are cooling. The National Federation of Independent Business reported that only 18% of small businesses see inflation as their biggest challenge, the lowest level since late 2021. The Cleveland Fed’s survey of firms also showed a notable decline in inflation expectations over the next 12 months.
Silver Market Forecast
Silver traders should keep a close eye on price action around $31.81. A break below this level increases the likelihood of a retest of $31.17, with potential downside risk toward $30.69 – $30.63 if selling intensifies. On the other hand, if buyers push silver above $31.95 with conviction, a rally toward $32.53 – $32.65 could unfold.
Macroeconomic factors, including today’s CPI report and Powell’s testimony, will likely drive market sentiment. If inflation data comes in hotter than expected, silver could face pressure from rising bond yields and a stronger dollar. However, any signs of cooling inflation could fuel speculation of Fed rate cuts, supporting precious metals.
More Information in our Economic Calendar.
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