The price of silver rose above $88 an ounce for the first time on Tuesday, after US inflation data indicated easing price pressures and reduced the risk of near-term monetary policy tightening.
The headline consumer price index for December held steady at 2.7%, while the core index remained at 2.6%, its lowest level since 2021, with a slight decrease in the monthly core index reading, which came in below expectations and eased concerns about inflation continuing to accelerate.
This inflationary signal boosted demand for precious metals, as investors anticipated that the accommodative monetary policy would continue for a longer period. The buying spree was further fueled by safe-haven flows triggered by news of the US Justice Department's investigation into Federal Reserve Chairman Jerome Powell and President Trump's announcement of a 25% tariff on countries doing trade with Iran.