Gold extended its upward momentum on Monday, reaching its highest level in six weeks as growing expectations of U.S. interest rate cuts pressured the dollar. Silver also staged a standout performance, hitting a fresh all-time high ahead of key U.S. economic releases.
Spot gold climbed 0.3% to US$4,241.27 per ounce by 1:44 p.m. ET (1844 GMT), the strongest level since 21 October. U.S. gold futures for February delivery settled 0.5% higher at US$4,274.80.
Silver outperformed the precious metals complex, jumping 3.8% to US$58.57 per ounce after briefly touching a record US$58.83. The metal has now surged more than 100% year-to-date, fuelled by tightening supply conditions and sustained investor demand.
The U.S. dollar slipped to a two-week low, making precious metals more attractive for international buyers.
“Expectations of further rate cuts, combined with inflation still running above the Fed’s target, continue to underpin both gold and silver,” said David Meger, Director of Metals Trading at High Ridge Futures.
Rate-Cut Bets Strengthen
Market pricing now reflects an 87% probability of a Fed rate cut in December, driven by softer U.S. economic data and dovish commentary from Federal Reserve officials, including Governor Christopher Waller and New York Fed President John Williams.
Lower interest rates generally favour non-yielding assets such as gold, strengthening their appeal during easing cycles.
This week, investors are watching several key data releases:
November ADP Employment Report – Wednesday
September PCE Index (Fed’s preferred inflation gauge) – Friday (delayed release)
Remarks from Fed Chair Jerome Powell – expected later Monday
Meger noted additional support stemming from expectations that the next Federal Reserve Chair may take a more dovish approach. White House economic adviser Kevin Hassett said he would be willing to serve if selected, while Treasury Secretary Scott Bessent suggested an announcement could come before Christmas.
“We still view gold and silver within a firm sideways-to-higher trend,” Meger added.
Other Precious Metals
Platinum: down 0.7% at US$1,660.69
Palladium: down 2.1% at US$1,431.52
