SMM’s 10:00 price for Ag (T+D) on the Shanghai Gold Exchange was 15,160 yuan/kg, with the premium/discount range quoted at TD-5 to +10 yuan/kg, averaging +2.5 yuan/kg.
On the macro front, Fed Chairman Kevin Warsh was reportedly ready to raise rates at the September meeting, and expectations for a hike would further intensify if inflation data came in hot. The US Fed's James Bullard said the likelihood of inflation persisting above target had increased, and the latest FOMC meeting leaned toward a rate hike. US initial jobless claims came in at 199,000, staying below 200,000 for a third straight week, pointing to resilience in the labor market. Against the mixed macro backdrop, silver gave back some of its gains yesterday, with the market focused on tonight’s non-farm payrolls data for guidance.
In the spot market, trading remained in the doldrums this week. A stagnant spot-futures price spread dampened traders’ willingness to offer, while this month’s smelter supply was largely locked into long-term contracts and export orders, keeping overall supply tight. Demand continued to be suppressed by last week’s rally in silver prices, with deals mostly backed by banks. Morning quotes in Shanghai were concentrated around on par with TD to +10 yuan/kg; in Shenzhen, some standard-grade supply hovered around a small discount to on par with TD, with demand weak and limited to just-in-time procurement. The market quoted the SHFE most-traded 2610 contract at a discount of 65 to 50 yuan/kg today.
Overall, the upcoming July non-farm payrolls data will be the core pricing anchor for the next phase, directly determining the scale of revisions to US Fed rate hike expectations and setting the near-term direction for precious metals. In the spot market, this week’s transactions remained on the list, orders stayed persistently weak, and deals continued to find support from banks.
