Silver Price Today, September 1: Silver Holds Near $66.64 as Fed Rate-Hike Bets Limit Recovery

Key Takeaways

• International silver traded near $66.64 per troy ounce, rising approximately 0.18% during Tuesday’s session.
• Silver gained nearly 15% in August but remains close to a two-week low following its post-Jackson Hole sell-off.
• Higher Treasury yields are creating short-term pressure, while tight physical supply and a projected sixth consecutive annual market deficit provide longer-term support.

Silver Price Edges Higher After Recent Sell-Off

Silver prices stabilised on Tuesday, September 1, following a sharp decline triggered by rising expectations that the Federal Reserve could increase interest rates later this month.

International silver traded around $66.64 per troy ounce at the time of writing, representing an increase of approximately 0.18% for the session. Despite the modest recovery, the metal remained close to its lowest level in two weeks.

Front-month COMEX silver futures settled 1.2% lower at $66.221 on August 31. The decline followed a fall of more than 4% on Friday as traders reacted to Federal Reserve Chair Kevin Warsh’s hawkish Jackson Hole speech.

The pullback did not erase silver’s strong August performance. Futures gained 14.98% during the month, ending two consecutive months of losses. Benchmark-linked international prices advanced approximately 15.5% over the same period and remained nearly 63% above their year-earlier level.

Fed Rate-Hike Expectations Pressure Precious Metals

Silver’s short-term direction continues to depend heavily on US monetary policy expectations.

Warsh reaffirmed that the Federal Reserve’s 2% Inflation objective is a firm target and warned that policymakers still have work to do unless underlying inflation moves lower at a sufficient pace.

The Fed chair highlighted annual PCE inflation of 3.7% and a six-month rate of 4.1%, arguing that recent softer inflation readings had not materially changed the broader trend.

Markets subsequently raised the implied probability of a September interest-rate increase to more than 65%, compared with approximately 36% before the speech.

The shift pushed the US 10-year Treasury yield to around 4.78%. Higher yields typically reduce the relative appeal of precious metals because silver and gold do not provide interest income. A firmer dollar can create additional pressure by making dollar-denominated commodities are more expensive for buyers using other currencies.

Silver can be more volatile than gold because it combines monetary and industrial characteristics. Changes in interest rates influence investment demand, while expectations surrounding manufacturing, electronics, solar energy and global economic growth affect its industrial outlook.

Middle East Conflict Creates Conflicting Price Drivers

Renewed military activity involving the United States and Iran added another layer of uncertainty.

US forces struck an Iranian island in the Strait of Hormuz, while Iran responded with attacks targeting the United Arab Emirates and Jordan. The escalation increased demand for defensive assets but also pushed energy prices higher.

WTI crude traded near $86.50 per barrel, while Brent crude moved above $91. Rising oil prices could keep inflation elevated and strengthen the case for tighter Federal Reserve policy.

This creates conflicting signals for silver. Geopolitical risk can support precious-metal demand, but higher energy costs, Treasury yields and interest-rate expectations can pressure non-yielding assets. The result has been elevated volatility rather than a straightforward safe-haven rally.

Silver’s August Rally Reflects Fiscal and Supply Concerns

Silver’s strong August performance was partly driven by renewed concerns about US debt and currency depreciation.

The US Treasury’s plan to increase liquidity-support purchases of longer-dated government bonds helped lower borrowing costs temporarily but also revived the “debasement trade.” This theme reflects investor concerns that higher government debt and expanding liquidity could weaken the long-term purchasing power of conventional currencies.

Silver also continues to benefit from tighter physical-market conditions. The global silver market is expected to record its sixth consecutive annual supply deficit in 2026, with demand projected to exceed supply by approximately 67 million ounces.

Total supply is forecast to increase 1.5% to 1.05 billion ounces, while mine production is expected to rise only 1% to around 820 million ounces. Physical investment demand, meanwhile, is projected to grow 20% to a three-year high of 227 million ounces.

Industrial fabrication is forecast to decline approximately 2% to 650 million ounces as manufacturers reduce the amount of silver used in photovoltaic products. However, demand linked to data centres, artificial intelligence infrastructure, electronics and the automotive sector is expected to offset part of that weakness.

These fundamentals may help limit deeper declines, although they do not remove the short-term risks created by higher interest rates and slowing industrial activity.

Also read Silver Price Forecast 2026, 2027 and 2030: Can XAG/USD Reach a New Record High?

Silver Price Outlook: Levels and Events to Watch

The area around $66 represents the immediate reference point following the recent sell-off. A sustained move below this level could expose silver to further profit-taking, particularly if Treasury yields and the dollar continues rising.

On the upside, the $68–$69 region may act as the first significant resistance zone. Silver traded near $68.64 on August 25 before the hawkish shift in Federal Reserve expectations. A return above this area could bring the psychologically important $70 level back into focus.

The next major catalysts include the July US JOLTS report on September 1 and the August employment report on Friday, September 4. US producer-price and consumer-price data will follow on September 10 and September 11.

Weaker employment or inflation figures could reduce expectations for a September rate increase, potentially supporting silver. Stronger data could keep Treasury yields elevated and place the $66 support area under renewed pressure.

For now, silver remains caught between a hawkish Federal Reserve and supportive long-term supply fundamentals. That combination could keep price movements volatile as the September policy meeting approaches.