Silver (XAG) Forecast: Jobs Data Fuels Rate Cut Hopes—Will Silver Bounce?

Silver Prices Steady as Gold Drops Despite Weaker Dollar and Lower Yields

Silver prices are holding near key support at $31.81, maintaining a neutral stance as traders assess shifting market conditions. Gold, however, is under pressure despite a plunge in the U.S. dollar and slightly lower Treasury yields following weaker-than-expected private payroll data. This unusual divergence has raised caution in the silver market, as traders look for confirmation of a sustained move higher.

At 14:08 GMT, XAG/USD is trading $32.14, up $0.15 or +0.47%.

Gold Declines Despite Rate-Cut Expectations

Gold is trading lower even as the U.S. dollar index tumbles and Treasury yields edge lower after the ADP employment report showed just 77,000 private-sector jobs added in February, well below forecasts of 140,000. The 10-year Treasury yield has dipped, reducing the opportunity cost of holding non-yielding assets like gold and silver.

Typically, a weaker dollar and lower yields would support gold prices, but today’s sell-off suggests that some traders are taking profits after gold’s recent strength. Gold remains above key support at $2,895.29, with stronger downside levels at $2,864.26 and $2,843.43. A break below $2,832.72 could accelerate selling pressure, while resistance remains near $2,910.32.

ADP Report Raises Rate-Cut Speculation

The weak ADP jobs report has intensified speculation that the Federal Reserve may move toward cutting rates sooner than expected. The report highlighted job losses in trade, transportation, utilities (-33,000 jobs), and education and health services (-28,000 jobs), signaling broader economic weakness. Small businesses struggled, reporting a net loss of 12,000 jobs, underscoring rising economic pressures.

Despite weak hiring, wage growth held steady at 4.7% annually, which could keep inflation concerns in focus. The nonfarm payrolls report on Friday will be the next major data point, with traders watching closely for any signs that labor market weakness is accelerating.

Silver’s Technical Outlook: Holding Support, Watching Gold

Silver remains above key support at $31.81, with resistance near $32.53. A move below support could trigger a retest of the 50-day moving average at $31.02, while a breakout above resistance would indicate stronger bullish momentum.

With gold unexpectedly lower despite favorable macro conditions, silver traders are exercising caution. The next move will depend on whether gold finds stability or extends its decline. If Friday’s jobs report further weakens the case for Fed tightening, silver could benefit from renewed buying interest. Until then, the market remains in consolidation mode.

More Information in our Economic Calendar.