The continuous rise of silver: How Federal Reserve rate cut expectations are driving up precious metals

Spot Silver rises again today, with an intraday increase of 4.00%, currently trading at $83.14 per ounce. This marks several consecutive days of strong performance for silver. According to the latest news, when silver broke through $80 per ounce last week, the intraday gain was already 3.96%, and the total weekly increase approached 10%, with a cumulative rise of over $7. This accelerated upward movement reflects the market’s re-pricing of the Federal Reserve’s policy shift.

Short-term acceleration and simultaneous gains in precious metals

The rally in silver is not isolated. Recent reports indicate that precious metals performed strongly last week, with spot gold closing up over 4% and a total increase of more than $177. In comparison, silver’s gains are even more prominent, reflecting a renewed market recognition of silver’s dual role as both a risk asset and a safe-haven asset.

Driving factors: policy shift and soft employment data

The logic behind this wave of precious metals rally is quite clear, driven by several factors:

Reignition of Fed rate cut expectations

Recent market developments show that Fed officials have recently signaled a more dovish stance. The market is now betting that the Fed will cut rates at least twice by 2026. This shift in expectations directly supports precious metal prices, as a low-interest-rate environment typically weakens the dollar’s appeal, thereby boosting dollar-denominated commodities.

Weak employment data

Last week, the US non-farm payroll report showed only 50,000 new jobs added in December 2025, below the market expectation of 60,000. This soft employment data further reinforces market expectations that the Fed may accelerate rate cuts, serving as a direct catalyst for higher precious metal prices.

Geopolitical instability

According to data, the combined influence of geopolitical instability and the shift in Fed monetary policy expectations has demonstrated extraordinary strength in the precious metals complex. Amid increasing global uncertainty, the appeal of gold and silver as traditional safe-haven assets has risen significantly.

Subtle changes in market structure: integration of crypto and traditional finance

It is worth noting that alongside this precious metals rally, significant changes are occurring in market structure. According to the latest news, Binance has officially launched perpetual contracts settled in USDT for spot gold (XAU) and spot silver (XAG) under the Abu Dhabi compliance framework. This marks the first deep entry of mainstream crypto trading platforms into the traditional commodities sector.

The significance of this move lies in enabling users to participate in precious metals trading conveniently via crypto trading platforms without holding physical gold or silver, enjoying 24/7 trading and leverage services. This further indicates that by 2026, the boundary between the crypto market and traditional finance is accelerating to blur, and the barriers to precious metals allocation are being significantly lowered.

Future catalysts: CPI data as a key factor

Looking ahead, the US will release the December Consumer Price Index (CPI) next Tuesday. This data could greatly influence market sentiment and directly determine the trend of gold and silver prices over the coming week. Additionally, multiple Fed officials will be speaking intensively next week, and their statements will further impact expectations for the pace of rate cuts.

It is important to note that although some Fed officials have mentioned the possibility of a 150 basis point rate cut this year, such an overly dovish commitment, far exceeding market expectations, is often seen as a “stabilizing market sentiment” statement. The actual implementation will depend on subsequent economic data and official policy announcements.

Summary

The continuous rise in silver reflects the market’s pricing of the Fed’s policy shift. From last week’s nearly 10% weekly increase to today’s 4% intraday gain, this accelerating trend indicates a strengthening consensus on rate cut expectations. However, the sustainability of this rally ultimately depends on US economic data and the Fed’s actual policy actions. Next week’s CPI data and Fed officials’ speeches will be key moments to test these expectations. Meanwhile, platforms like Binance launching precious metals contracts are also changing traditional safe-haven asset trading methods, and it is worth monitoring how this integration trend develops.