Gold Prices Climb to Two-Week High as Markets Bet on December Fed Rate Cut

Mumbai | November 10

Gold prices rose to a two-week high on Monday as expectations of a potential U.S. Federal Reserve interest rate cut in December increased, amid signs of cooling momentum in the American economy and growing concerns over a broader global slowdown.

Spot gold was up 1.8% at $4,070.99 per ounce, touching its highest level since October 27. U.S. gold futures for December delivery also advanced 1.8% to $4,079.70 per ounce.

Soft Labour and Consumer Data Strengthen Rate-Cut Expectations

Recent U.S. economic data pointed to a slowdown in activity. Job losses were reported in October, including in government and retail categories, while several companies continued restructuring and automation-related workforce reductions. Meanwhile, consumer sentiment for early November fell to its lowest reading in nearly three and a half years, reflecting concerns about financial conditions and economic stability.

The prolonged 40-day U.S. government shutdown has contributed to interruptions in federal services, delayed salaries, food assistance programme disruptions, and air travel staffing constraints. Although the U.S. Senate signalled progress toward reopening government operations, the shutdown’s economic effects continue to be assessed.

According to the CME FedWatch Tool, futures pricing now indicates a 67% probability of a Federal Reserve rate cut in December. Gold often benefits during periods of reduced interest rates, as lower yields reduce the opportunity cost of holding non-interest-bearing precious metals.

Gold ETF Holdings Rise Alongside Broader Precious Metals

Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, increased to 1,042.06 metric tonnes, up from 1,040.35 tonnes the previous day. Flows into gold-backed ETFs are monitored as a measure of portfolio-based demand for the metal.

Other precious metals also gained during the session:

• Silver rose 2.5% to $49.52 per ounce
• Platinum increased 1.3% to $1,565.22 per ounce
• Palladium edged 1.1% higher to $1,396.37 per ounce

Market attention will now turn to upcoming U.S. data releases and Federal Reserve communication ahead of the December policy meeting, which is expected to influence the next direction of gold prices and broader precious metals markets.

With Inputs form money control