Lower inflation strengthens the case for easier policy over time, even if near-term rate cuts remain uncertain. Futures markets currently assign a 26.6% probability of a rate reduction at the next Federal Reserve meeting, based on CME FedWatch data.
Economists argue that direction matters more than timing. “The inflation trend improves the outlook for policy easing beyond the near term,” said Sal Guatieri, senior economist at BMO Capital Markets.
Demand and Risk Considerations Keep Downside Contained
Beyond interest rates, demand dynamics continue to underpin both metals. Central banks have maintained elevated gold purchases compared with historical averages, while investment demand remains resilient amid uncertainty around global growth and fiscal policy.
Silver, meanwhile, continues to draw support from its industrial role, particularly in energy transition applications, alongside its monetary characteristics. This dual demand profile has helped limit downside volatility during periods of shifting macro expectations.
Geopolitical tensions tied to energy markets and global supply routes have also sustained interest in defensive assets, even as broader risk sentiment stabilizes. Investors are now turning to forward-looking indicators, including consumer confidence data, to assess whether easing inflation is feeding into economic expectations.
For now, gold and silver appear anchored by fundamentals, with macro forces continuing to shape medium-term demand rather than short-term market noise.