Gold prices exhibited resilience on Thursday, recovering from earlier declines as softer-than-expected inflation data from the U.S. reinforced expectations for Federal Reserve interest rate cuts in 2026. Spot gold was reported at $4,333.57 per ounce, a slight decrease of 0.1%, while U.S. gold futures dipped 0.2% to $4,366.80.
Recent data indicated that U.S. consumer prices rose by 2.7% year-on-year in November, falling short of the 3.1% increase that economists had anticipated. Following the inflation report, futures on the federal funds rate began to reflect a heightened probability of the Federal Reserve reducing interest rates in its upcoming January meeting. David Meger, director of metals trading at High Ridge Futures, noted that the Consumer Price Index (CPI) report was “dollar negative and gold positive,” emphasizing the market’s focus on the Fed’s upcoming decisions as it navigates potential rate cuts into 2026.
Non-yielding assets like gold often benefit from a lower interest rate environment, and traders are currently forecasting a total of 63 basis points in rate reductions by the Federal Reserve for the next year. In a related development, U.S. President Donald Trump stated that the next Federal Reserve chair would back significantly lower interest rates, with an announcement expected in early 2024.
In the broader precious metals market, spot silver fell by 0.4% to $66.04 per ounce, retreating from its record high of $66.88 reached in the prior session. Meger commented on this trend, noting that both gold and silver had experienced substantial gains recently, making the market’s profit-taking and consolidation phase not unexpected. Despite the recent dip, silver has outperformed gold significantly this year, surging 129% amid growing investment demand and concerns regarding a potential supply deficit.
In contrast, platinum prices edged up by 0.7%, reaching $1,924.05—marking the highest level in over 17 years. Additionally, palladium showed impressive gains, climbing 2.9% to nearly three-year highs at $1,695.68. According to a note from Commerzbank, the rising prices for precious metals, particularly platinum, are being supported by robust demand from China.
As the precious metals market continues to evolve, careful attention is being paid to economic indicators, particularly those related to inflation and Federal Reserve policy changes, which will likely influence trends in gold and associated assets moving forward.
