Silver Hits Record High as Markets Await Federal Reserve Policy Decision

Global financial markets adopted a posture of measured restraint on Thursday, December 10, 2025, as participants awaited the concluding statement from the US Federal Reserve's policy meeting, shifting attention from recent geopolitical concerns. This cautious sentiment was mirrored across Asia on Wednesday, where regional indices retreated in anticipation of the highly anticipated Federal Open Market Committee (FOMC) decision.

Market consensus, supported by CME FedWatch data indicating an 88% probability, pointed toward a 25-basis-point reduction in the federal funds rate, which would position the target range between 3.50% and 3.75%. This expected move would mark the third consecutive rate cut in 2025, following similar easing actions implemented in September and October. Regional indices reflected the prevailing uncertainty: Japan's Nikkei 225 declined by 0.3% amid speculation of forthcoming policy adjustments by the Bank of Japan next week, while China's CSI 300 index registered a more significant drop of 0.9% following data showing producer price deflation of 2.2% year-on-year.

Amid the macroeconomic tension, the precious metal silver achieved a significant milestone, surging to an all-time high of $60.9125 per ounce. This historic breach is fundamentally driven by a chronic supply deficit, projected to persist for five to seven years, coupled with robust industrial consumption. Key demand catalysts include the requirements from the expanding electric vehicle (EV) sector and the construction of AI data centers, which utilize silver for high-conductivity connections and in solar photovoltaic panels. Industrial demand now accounts for approximately 60% of total silver usage, marking a fundamental shift from its traditional role as primarily a safe-haven asset.

Market focus now pivots to the forward guidance accompanying the rate decision, particularly the Summary of Economic Projections and the updated 'dot plot' for 2026, as Chair Jerome Powell prepares to address the press. Analysts note that while the 25 basis point cut is largely priced in, the forward guidance is the true swing factor, especially given the unusual public division within the FOMC regarding the 2026 trajectory. Furthermore, the convergence of the expected cut with the official end of Quantitative Tightening on December 1 creates an inflection point for liquidity, which is crucial for risk assets like Bitcoin, trading near $92,000.