Silver tilts higher as dollar bounces off 3-week high

Silver futures fluctuated higher in a tight range during the Asian session, to head for the  first weekly gain in three weeks as the dollar index retreated in its fourth session from its highest since June 19, according to the inverse relation between them, and on the threshold of developments and economic data releases expected today by the Chinese and the US economy.

As of 05:27 GMT, silver futures for September delivery rose by 0.07% to currently trade at $15.15 per ounce compared to the opening at $15.14, amid the decline of the US dollar index by 0.16% to 96.93 compared to the opening at 97.08.

The markets are now looking forward for the Chinese economy to release its trade data for the last month with the trade balance index released by China's General Administration of Customs, which could reflect a contraction of the surplus to 276 billion yuan Which is equivalent to $45.2 billion compared to 279 billion yuan, or $41.7 billion in May.

In the same vein, we followed Thursday the US President Donald Trump, expressing through his official account on Twitter, his country's disappointment with China, which did not meet the size of purchases of the US agricultural products promised earlier in the month.

On the other hand, the Chinese Ministry of Commerce yesterday also expressed China's hopes that Washington will remove restrictions on Huawei soon, explaining that both parties are trying to implement the commitments agreed by Chinese President Xi Jinping and his US counterpart during the events of the G20 last month, adding that the trade talks had not yet been discussed and that Beijing was consistent in addressing its fundamental concerns.

Investors are currently waiting for the US economy to disclose its PPI reading, which is a preliminary index of inflationary pressures, which may reflect the stability of growth at 0.1%, unchanged from what it was in the previous reading for May, while the core reading of the same index may hit a growth by 0.2%, unchanged from May.

In the same context, the annual PPI reading may show the growth slowing to 1.6% from 1.8% in the previous annual reading for May, and the core annualized reading for the same index may show a slowdown in growth to 2.1% from 2.3% in May. Hours after inflation data was released for last month, with the consumer price index reading released on Thursday and surpassing expectations.

Otherwise, we also followed on yesterday the second and the last half of the US Federal Reserve Governor Jerome Powell's semi-annual testimony before the Senate Banking Committee, after he gave his first half of the testimony before the House Financial Services Committee last Wednesday.

Its worth mentioning that Powell's testimony has reinforced market's speculations that the Fed monetary policy makers will cut federal funds at the next Federal Open Market Committee meeting scheduled for July 30-31, especially after the release of the minutes of the latest meeting, which in turn supported the chances of interest rates cuts by 25 basis points by the end of this month.