Silver steadied around $64.5 an ounce on Friday after pulling back in the previous session, as investors took profits while assessing the Federal Reserve’s policy outlook and developments in the Middle East. Data released Thursday showed US producer prices increased less than expected in July, offering further evidence that inflationary pressures are not broadly intensifying following Wednesday’s subdued CPI report.

The softer price data reduces pressure on the Fed to raise interest rates in the near term, with markets now pricing in around a 35% chance of a 25 basis point rate hike in September, down from 55% a week earlier.

Meanwhile, diplomatic efforts to reopen the Strait of Hormuz remain deadlocked, keeping investors cautious over the risk of an escalation that could drive energy prices higher and reignite inflationary pressures.