Silver Price Forecast: XAG/USD holds position above $29.00 ahead of US PMI data

• Silver price remains steady ahead of US PMI data due on Wednesday.
• The slowdown in the Chinese economy could negatively impact the industrial demand for Silver.
• The safe-haven Silver may struggle due to the increased ceasefire optimism in the Middle East.

Silver price (XAG/USD) stays above $29.00 per troy ounce during the European session on Wednesday. The price of the grey metal grapples to continue its gains as investors awaited a slew of key US economic data that could shed light on the path of Federal Reserve monetary policy.

The US Purchasing Managers Index (PMI) data is scheduled to be released later in the North American session. Additionally, the focus will be on the Gross Domestic Product (GDP) Annualized (Q2) figures, which are set to be released on Thursday, and the latest Personal Consumption Expenditures (PCE) price index report on Friday. These reports are expected to provide new insights into the economic conditions in the United States.

Meanwhile, sluggish economic activity in China has added extra selling pressure on Silver. Concerns about the weak Chinese economy were intensified by an unexpected rate cut from the People's Bank of China (PBoC) on Monday. Silver, which is crucial for various industrial applications including electronics, solar panels, and automotive components, is particularly sensitive to these economic conditions. Given China's position as one of the world's largest manufacturing hubs, the country's industrial demand for silver is substantial.

India has reduced import duties on gold and silver from 15% to 6% to support its jewelry manufacturing sector, which has positively impacted the demand outlook in the world's second-largest consumer of bullion.

The safe-haven assets like Silver could lose some demand from the increased optimism surrounding potential ceasefire negotiations between Israel and Hamas. Israeli Prime Minister Benjamin Netanyahu has hinted that a ceasefire agreement, which could lead to the release of several hostages in Gaza, might be in the works. Netanyahu is currently in Washington to address Congress, according to The Associated Press.

Egypt, Qatar, and the United States (US) are working to broker a phased deal between Israel and Hamas to halt the fighting and secure the release of remaining hostages. Meanwhile, in China, Palestinian factions Hamas and Fatah have signed a declaration to form a unity government and resolve their long-standing rift.