Silver Price Forecast: XAG/USD declines below $30.50 on slower US Fed rate cut buzz, firmer US Dollar

• Silver price drifts lower to around $30.20 in Monday's early European session.
• The stronger USD and elevated US bond yields exert some selling pressure on the white metal. 
• Safe-haven demand might cap the downside for Silver price. 

The Silver price (XAG/USD) attracts some sellers to near $30.20 during the early European session on Monday. The strengthening of the Greenback and rising US bond yields weigh on the USD-denominated commodity price. 

The expectation of a slower pace of rate cuts from the US Federal Reserve (Fed) this year amid sticky inflation and the strong labor market in the US economy might drag the white metal lower in the near term. The US Bureau of Labor Statistics (BLS) reported on Friday that Nonfarm Payrolls (NFP) rose by 256,000 in December versus 212,000 prior, better than the estimations of 160,000. Additionally, the Unemployment Rate ticked lower to 4.1% in December from 4.2% in November. 

On Friday, Fed St. Louis President Alberto Musalem highlighted greater caution is warranted in reducing interest rates, adding that the risk that inflation might get stuck between 2.5% and 3% had increased by the time of December's meeting.

Nonetheless, safe-haven flows due to uncertainties around President-elect Donald Trump's policies might help limit the Silver price's losses. Additionally, a record industrial demand, including applications in electronics, electric vehicles, and solar panels, is expected to push total demand to 1.21 billion ounces despite a 16% drop in physical investment, supporting the Silver price.