Silver Price Forecast: XAG/USD remains steady around $32.50 ahead of US election

• Silver price maintains its position as traders adopt caution due to increased uncertainty surrounding the US election results.
• The opinion polls indicate that former President Trump and Vice President Harris are nearly tied.
• Silver demand may increase due to rising expectations for additional stimulus measures from China.

Silver price (XAG/USD) maintains its position around 32.50 during Asian trading hours on Tuesday as traders adopt caution ahead of the US presidential election. However, the heightened uncertainty surrounding the election has led to increased demand for safe-haven assets like Silver.

The risk aversion sentiment has been amplified by speculation that a potential presidency under Republican nominee Donald Trump could lead to higher inflation, given his pledge to significantly raise trade tariffs. This has prompted investors to seek safe-haven assets as a hedge against long-term inflation risks.

However, the opinion polls indicate that former President Donald Trump and Vice President Kamala Harris are nearly tied. The final outcome may remain unknown for several days following Tuesday's vote. Both Trump and Harris expressed confidence in their chances as they campaigned across Pennsylvania on the last frantic day of this exceptionally close presidential race.

US Federal Reserve's (Fed) policy decision will be eyed on Thursday. Markets expect a modest 25 basis point rate cut this week. The CME FedWatch Tool shows a 99.5% probability of a quarter-point rate cut by the Fed in November. This could provide support for Silver as lower interest rates reduce the opportunity cost of holding non-interest-bearing assets.

Expectations for additional stimulus measures from China could bolster Silver demand as the Standing Committee of the National People's Congress (NPC) holds a five-day meeting from November 4 to 8. Chinese authorities are anticipated to approve a potential stimulus package exceeding 10 trillion yuan to support the country's economy. Given China's position as one of the world's largest manufacturing hubs for electronics, solar panels, and automotive components, this could lead to increased demand for Silver.