Investor Focus on the Fed:
The Federal Reserve’s likely interest rate cut has investors watching closely. Bart Melek, Global Head of Commodity Strategy at TD Securities, stated that the forecasted economic slowdown in 2026 and the Fed’s potential rate reduction are expected to draw investors back into gold. Melek added that gold performs well in low-interest-rate environments.
Recent dovish comments from Fed Governors, including Christopher Waller and John Williams, along with weaker economic data, have heightened expectations for a rate cut next month. Currently, there is an 87% chance of a rate reduction in December, up from 50% last week.
Jim Wyckoff, Senior Analyst at Kitco Metals, noted that the technical chart for silver shows a strong upward trend, attracting speculative buying in the precious metals market.
Weak Demand in Key Asian Markets:
Gold demand in major Asian markets softened this week due to high prices, despite the start of India’s wedding season. In China, the removal of tax exemptions for gold purchases has further impacted consumer demand.
Despite this, platinum and palladium saw strong performances. Platinum increased by 4%, reaching $1,672.50 per ounce, up 10.7% for the week, while palladium rose by 0.8% to $1,450.16, with a 5.6% weekly increase.
This continued surge in precious metal prices highlights growing investor interest amid expectations of a shift in U.S. monetary policy and ongoing market volatility.