Silver (XAG/USD) rebounded sharply on Wednesday, trading around $60.35 and marking a 3.19% increase at the time of writing. This rally was attributed to a weaker US Dollar following softer-than-expected US economic data and remarks from Federal Reserve Chair Kevin Warsh at the ECB Forum in Sintra. Warsh stated that the Fed would not provide forward guidance and noted that inflation risks have eased, which pressured the Greenback and supported precious metals like silver [1].
On the economic front, the ADP Employment Change report showed US private payrolls increased by 98K in June, missing expectations of 113K and down from 122K in May. The ISM Manufacturing PMI also declined to 53.3 in June from 54 previously, both data points missing market forecasts [1]. Market participants are now focused on the upcoming Nonfarm Payrolls (NFP) report for further direction on Fed policy [1].
Despite the recent rebound, analysts at OCBC, including Sim Moh Siong and Christopher Wong, have revised their end-2026 forecasts for silver lower to $67, citing a tougher near-term macro backdrop characterized by higher real yields, a stronger US Dollar, and slower ETF demand. They maintain a mildly upward trajectory for the medium term, arguing that the structural deficit story in silver remains intact, but stronger conviction depends on a more favorable macro environment [2].
OCBC analysts emphasize that a turnaround in silver prices would require improvements such as easing real yields, a softer US Dollar, or a clearer unwind in hawkish Fed expectations. Without these changes, rallies in silver are likely to be faded, and the metal may consolidate below previous highs [2]. Geopolitical factors, such as slow progress in US-Iran peace talks, continue to provide some safe-haven demand for precious metals [1].
CONCLUSION
Silver experienced a notable rebound above $60 due to weaker US data and dovish Fed commentary, but analysts have lowered their long-term price forecasts amid a challenging macro environment. While the medium-term outlook for silver remains constructive, sustained gains will likely depend on improvements in real yields, US Dollar strength, and Fed policy expectations.