Gold relatively steady in Monday morning trading ahead of the Fed policy meeting coming up on Wednesday.
While the central bank is widely expected to cut interest rates for a third consecutive time this week, markets will be watching for their read on the state of the economy, particularly given the dearth of data following the U.S. government shutdown this fall.
February gold futures fell 0.3% last week to settle at $4,243.00 an ounce on Comex. The most-active contract was unchanged Friday. Bullion gained 6.5% last month after increasing 3.2% in October and surging 10% in September, the most in six months. It’s up 61% this year. The metal rose 27% in 2024, its biggest annual gain since 2010. The February contract is currently down $9.10 (-0.21%) an ounce to $4233.90 and the DG spot price is $4201.20.
Gold got some support from China, which released data over the weekend showing that its central bank added to its bullion reserves for a 13th straight month in November.
March silver futures rallied 3.3% last week to settle at $59.05 an ounce on Comex, and the most-active contract rallied 2.7% Friday. The white metal hit record highs last week on a historic squeeze in the London market. Silver increased 19% in November after rising 3.3% in October and adding 15% in September. It’s more than doubled this year after rising 21% in 2024. The March contract is currently down $0.418 (-0.71%) an ounce to $58.635 and the DG spot price is $58.22.
In economic news, the Fed’s favorite inflation measure, the personal expenditures price index, came out Friday with delayed September data. It showed core PCE, which excludes volatile food and energy prices, rose 0.2% in September from a month earlier, while the year-on-year increase was 2.8% The annual figure was lower than economists had anticipated, making it more likely that the Fed will cut rates. The Fed has an annual inflation target of 2%.
Investors are pricing in a 25 basis point cut at this week’s Fed meeting. More than 89% of the investors tracked by the CME FedWatch Tool are betting that the Fed will cut rates by 25 basis points Wednesday, while the rest expect rates to stay unchanged. An additional rate cut would be considered bullish for precious metals, making them a more attractive alternate investment.
October’s interest rate reduction to 3.75% to 4.00% was the second 25-basis point reduction in a row. The central bank began raising interest rates in March 2022 to fight inflation, ultimately imposing increases of by 5.25 percentage points before beginning rate cuts last year. The
Spot palladium gained 1% last week to $1,465.00 an ounce after advancing 0.6% Friday. Palladium added 0.5% in November after rising 14% in October and gaining 14% in September. Palladium is up 58% this year after dropping 17% in 2024. Currently, the DG spot price is up $32.80 an ounce to $1492.50.
Spot platinum slid 0.1% last week to $1,654.40 an ounce and after losing 0.4% Friday. It climbed 4.7% in November after rising 1% in October and gaining 15% in September. Platinum is up 81% in 2025 after losing 8.4% in 2024. The DG spot price is currently up $14.20 an ounce to $1665.70.
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