Silver Price Forecast: XAG/USD dives below $19.00 on high US T-bond yields

• Silver price registered losses for two consecutive days, dropping below the $19.00 figure.
• US Retail Sales rebounded unexpectedly, while weekly jobless claims dropped.
• Silver traders eye the University of Michigan Consumer Sentiment alongside next week’s FOMC decision.

Silver prices are dropping for the second consecutive day amidst a risk-off impulse, courtesy of worries about an aggressive Fed and expectations of a 75 or 100 bps interest rate hike by the Fed. Therefore, US Treasury bond yields spiked, underpinning the greenback, a headwind for the white metal. At the time of writing, the XAG/USD is trading at $18.91, below the $19.00 handle.

Sentiment remains negative, with global equities registering losses. US data released on Thursday cemented the case for a third consecutive 75 bps rate hike by the Fed, with Retail Sales in August exceeding estimations for a drop of 0.1%, increasing by 0.3% MoM, but on an annual basis, missed the last number.

In the meantime, the US Labor Department revealed that unemployment claims for the week ending on September 10 diminished by 213K, less than forecasts of 227K, illustrating the tightness of the labor market.

Elsewhere, a tranche of regional Fed Manufacturing Indices was reported, led by the New York and Philadelphia Fed. The Empire State Index, albeit improving, failed to exit from contractionary conditions, while the Philadelphia Fed index tumbled to the contractionary territory after rebounding in the August report.

What to watch

The US economic docket will feature the  University of Michigan Consumer Sentiment alongside consumer inflation expectations.

Silver (XAG/USD) Key Technical Levels