Silver prices climbed nearly 1% to reach $57.29 per ounce, driven largely by concerns over tightening supply and declining warehouse inventories in Shanghai. The slight rise occurred despite only minimal impact on the broader market from Friday’s CME trading disruption. Markets have already fully priced in a 25-basis-point Federal Reserve rate cut, making non-yielding assets like silver more appealing in the current environment.

On Monday, silver broke above $57 per ounce, hitting a new record high as supply-linked inventories tied to the Shanghai Futures Exchange dropped to their lowest level in almost ten years. This sharp reduction in stock levels acted as a major catalyst for the price rally. Even with the CME’s recent technical interruption, spot prices continued their upward trajectory, supported by strong underlying demand factors.

Expectations of a U.S. rate cut strengthened further due to weak labor market data and cautious commentary from Federal Reserve officials. These developments boosted investor interest in precious metals, which tend to perform well when borrowing costs decline and income-generating assets become less attractive. Silver, as a non-yielding asset, benefited directly from this shift in sentiment.

Additionally, the six-week U.S. government shutdown delayed key economic data releases, reinforcing market assumptions of lower future interest rates. This combination of supply constraints, macroeconomic uncertainty, and heightened expectations of monetary easing kept investor confidence in silver at elevated levels, driving its continued rise.