Silver Prices Tread Water amid Renewed Dollar Strength

London (Feb 15)  Silver prices held within a narrow range on Wednesday, as the U.S. dollar strengthened for an eleventh consecutive session against a basket of other major currencies.

March silver futures traded at $17.89 a troy ounce at 7:44 am ET, virtually unchanged from the previous close. Prices fluctuated within a narrow range of $17.83 and $17.97 through the overnight session.

The grey metal has traded within a narrow range this week, as risk appetite and a stronger dollar kept demand for precious metals relatively subdued. Silver’s outlook remains bullish, with prices in a six-week uptrend.

April gold futures edged slightly higher on Wednesday and were on pace to snap a four-day losing streak. The futures contract rose $2.30, or 0.2%, to $1,227.70 a troy ounce. Bullion reached a high of $1,231.40 during the overnight session.

Stronger demand for the U.S. dollar provided some resistance to precious metals on Wednesday. The dollar index rose for an eleventh straight day, climbing 0.2% to 101.41. That was the highest settlement in over a month. The U.S. currency recorded gains versus the euro, pound and yen.

On Tuesday, Federal Reserve Chairwoman Janet Yellen told lawmakers in Congress it would be “unwise” to keep interest rates too low, given the recent pick up in inflation and economic growth. Yellen will testify before the House Financial Services Committee later today.

In economic data, the Eurozone trade surplus strengthened more than expected in December, as exports rose faster than imports. Eurostat reported a surplus of €24.4 billion in December, up from €22.7 billion the previous month. Analysts forecast a slight decline to €22.5 billion.

On Tuesday, the Eurozone’s fourth quarter GDP growth was revised lower to 0.4% from 0.5%. That translated into an annualized gain of 1.7%, lower than the 1.8% reported initially.

Source: EconomicCalendar