Silver prices (XAG/USD) climbed modestly during Thursday’s Asian trading session, rebounding to around $34.50 per troy ounce after back-to-back losses in the previous two days. The recovery is supported by a wave of safe-haven demand, as investors navigate mounting global economic and geopolitical uncertainties.
The uptick in silver—like other non-yielding assets—comes in the wake of disappointing U.S. economic indicators, which have strengthened market expectations that the Federal Reserve could initiate at least two interest rate cuts in 2025.
Key among the data was the Institute for Supply Management’s (ISM) Services Purchasing Managers Index (PMI), which fell to 49.9 in May from 51.6 in April. This marked a contraction in the sector and missed the forecast of 52.0. Adding to the downbeat outlook, ADP private-sector employment figures showed just a 37,000 increase in May—well below both the revised April gain of 60,000 and the market estimate of 115,000.
Market participants now turn their attention to upcoming U.S. data, including trade balance figures and initial jobless claims, due later Thursday. However, the main focus remains Friday’s Nonfarm Payrolls report, which could further influence the Fed’s monetary policy stance.
The discussion around rate cuts was amplified by former U.S. President Donald Trump, who took to Truth Social on Wednesday to pressure Fed Chair Jerome Powell. “ADP NUMBER OUT!!! ‘Too Late.’ Powell must now LOWER THE RATE. He is unbelievable!!! Europe has lowered NINE TIMES,” Trump wrote.
Meanwhile, Minneapolis Fed President Neel Kashkari acknowledged signs of cooling in the labor market but emphasized the need for patience amid continued economic uncertainty. “The Fed must stay in wait-and-see mode,” he said, reflecting a cautious approach to policy changes.
With economic data sending mixed signals and political rhetoric heating up, silver may continue to benefit from its traditional role as a safe-haven asset in turbulent times.
