Silver touches three-week low as dollar resumes rebound

Silver futures fell over one percent in American trade to February 9 lows as the dollar index rebounded from December 17, 2014 lows for the seventh session out of eight, following earlier data from the US, the world's largest economy, while Federal Reserve Chair Jerome Powell testified on the Semiannual Monetary Policy Report before the House Financial Services Committee, in Washington DC, today. 

. 

As of 06:33 GMT, silver futures due on May 15 rose 0.52% to $16.620 an ounce from the opening of $16.549, while the dollar index inched up to 89.89 from the opening of 89.88. 

In his testimony earlier today, Powell expressed admiration for former Chair Janet Yellen's work to strengthen the economy and normalize the balance sheet, lauding her for helping to smooth out the transition and provide continuity in monetary policy. 

Powell expected the Fed to continue tightening monetary policy gradually, while pointing to economic outlook as strong, asserting the importance of balancing the push of inflation just towards the target and not beyond it, adding that labor strength will underpin spending and income. 

Earlier US data showed durable goods orders fell 3.7% in January, compared to a 2.8% rise in December, and missing expectations of a 2.4% drop, while core orders also fell 0.3%, compared to a 0.7% rise in December and missing forecasts of 0.4% rise. 

The goods trade deficit widened while wholesale inventories rose past expectations in January, as the House Price index slowed more than expected in December. 

The Richmond Manufacturing Index rose to 28 in February from 14 in January, beating expectations of 15, while the CB consumer confidence survey rose to 130.8 in February from 124.3 in January, beating forecasts of 126.2. 

Markets now look forward to the Fed's March 20-21 meeting, the first under new Chair Jerome Powell, at which policymakers will release their three-year forecasts for inflation, unemployment, growth, and interest rates.