Silver Prices Hold Steady After FOMC Minutes

London (Feb 23)  Silver prices were little changed on Thursday, as price action continued to cluster around $18 after the minutes of the latest Federal Reserve meeting signaled higher interest rates are on the way.

May silver futures edged up 5 cents, or 0.3%, to $18.07 a troy ounce at 7:34 am ET, according to Barchart. Prices fluctuated within a narrow range through the overnight session.

After nearly two months of gains, the grey metal is on track for a narrow weekly decline. However, the outlook remains favorable for an extended rally in the days and weeks ahead as part of a broader consolidation trend since mid-December.

Meanwhile, April gold futures climbed $8.10, or 0.6%, to $1,241.40 a troy ounce. Bullion declined 0.4% in the previous session.

The Federal Reserve could be on course to raise interest rates even faster than previously estimated. That was the key takeaway of the Jan. 31-Feb. 1 Federal Open Market Committee (FOMC) meeting minutes, which were released Wednesday afternoon at 2:00 pm ET.

FOMC members “expressed the view that it might be appropriate to raise the federal funds rate against fairly soon” if data on employment and inflation meet or exceed current expectations, the official transcript said. U.S. consumer inflation rose at an annualized 2.5% in January, the highest in nearly four years. Employment growth remains solid, while jobless claims have remained below 300,000 for nearly two years.

After the minutes, traders raised their expectations for a May rate increase, based on CME Fed Fund futures prices. Earlier in the week, market participants saw June as the likely date for the next rate adjustment.

A more hawkish Fed didn’t help the U.S. dollar, which ended lower on Wednesday. The dollar index was last down 0.1% at 101.16 Thursday morning.

Source: EconomicCalenday