Silver's outlook after the latest FOMC

The Federal Reserve's median forecast showed a "less worse" economic outlook, though silver's upside momentum has been limited by a rebound in U.S. dollar...

FED 6

The Federal Reserve kept its Fed funds rate at 0.00%-0.25% unchanged, while officials' median forecast showed that interest rate would hold at current level through 2023. Even though the outcome was largely as expected, the Fed sees a smaller decline in GDP this year, better unemployment rate and inflation, compared with its previous projections made in June.


Fed’s projections:


Source: U.S. Federal Reserve

An improved outlook should benefit silver, as it can be used for industrial purpose, but at the same time a rebound in the U.S. dollar has limited the white metal's upside momentum.


From a technical point of view, spot silver keeps trading within a narrow range after a rally in March to August. Nevertheless, it maintains a bullish bias as it stays above the ascending 50-day moving average. The level at $25.30 may be considered as the nearest support, while the 1st and 2nd resistance are expected to be located at $28.90 and $30.00 respectively.


Source: Gain Capital, TradingView

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