The silver price per ounce today (Wednesday) fell into the red as the investors await next week's Federal Open Market Committee (FOMC) meeting.
At 10:20 this morning, the spot silver price per ounce was down 0.44% to $14.69. Silver futures - which trade 5,000 troy ounces on each contract - are coming off a volatile month. They fell 1.4% in August but are up 0.7% in September.
The decline in the silver price per ounce today comes ahead of the FOMC meeting starting on Sept. 16. The two-day assembly will determine whether the U.S. Federal Reserve will raise interest rates for the first time in 10 years.
The days leading up to these meetings typically leave precious metal traders on edge. If the Fed decides to hike rates, it would boost the U.S. dollar and dollar-denominated commodities like silver. If the Fed decides not to raise rates, it could cause a huge sell-off and send the silver price per ounce even lower.
But investors shouldn't expect interest rates to move anywhere next week. According to Money Morning Chief Investment Strategist Keith Fitz-Gerald, there's a confluence of global economic factors that make raising rates a huge mistake.
"It would be totally irresponsible for the Fed to raise rates right now," Fitz-Gerald explained in an interview on Kitco News. "You got weak China, weak data, weak consumer, an American public that's been absolutely eviscerated."
"To me, this is the wrong time to do it."
Alex McGuire is an associate editor for Money Morning who writes about commodities. Follow him on Twitter at @AlexMcGuire92 for the biggest commodity price updates.
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