• Silver price gathers strength to break above $28.00 on firm Fed rate-cut prospects.
• US inflation grew moderately in July.
• Investors await the US monthly Retail Sales data for July.

Silver price (XAG/USD) jumps to near crucial resistance of $28.00 in Thursday’s European session. The white metal aims to deliver more upside as investors expect that the Federal Reserve (Fed) looks set to start reducing interest rates from the September meeting.

According to the CME FedWatch tool, 30-day Federal Finds Futures pricing data shows that the Fed is certain to cut its key borrowing rates in September but traders are split over the size of interest-rate cuts.

Firm speculation for Fed rate cuts has been further boosted by the moderate increase in the United States (US) Consumer Price Index (CPI) data in July, which confirmed that progress in the disinflation process towards bank’s target of 2% continues. Annual headline and core CPI, which excludes volatile food and energy prices, decelerated to 2.9% and 3.2%, respectively.

Growing expectations for Fed rate cuts have weighed on the US Dollar (USD) and bond yields. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, exhibits a subdued performance slightly above a more than seven-month low of 102.16. 10-year US Treasury yields jump to near 8.45% but are still close to weekly lows.