Gold price prediction: Gold rate falls after U.S. Fed interest rate cut, Silver price nears record high

Gold edged lower on Thursday, as traders weighed the U.S. Federal Reserve's divided vote on a quarter-percentage-point interest rate cut, while silver climbed to yet another record high. Spot gold fell 0.3 per cent to $4,217.09 per ounce. U.S. gold futures for February delivery gained 0.5 per cent to $4,244.70 per ounce. Spot silver rose 1 per cent to $62.39 per ounce, after hitting a record high of $62.88 earlier in the session, bringing its year-to-date gain to 116 per cent on strong industrial demand, declining inventories and its addition to the U.S. critical minerals list.

"It's just an overpositioning (in gold) in expectation of the rate cut, which did happen, and therefore you're seeing some selling pressure," said independent analyst Ross Norman, adding that gold's fundamentals remained intact.

The U.S Fed cut interest rates by a quarter of a percentage point on Wednesday in a rare divided vote, but signalled a pause on further easing as officials look ahead to assess the direction of the job market and inflation that "remains somewhat elevated."


Lower interest rates typically benefit non-yielding assets such as gold.

Projections issued after the two-day meeting showed most policymakers see just one rate cut in 2026. Fed Chair Jerome Powell offered no indication of when another cut might occur.

U.S. President Donald Trump said on Wednesday that the Fed's rate cut could have been larger. Trump is set to announce the new Fed chair early next year, with White House economic adviser Kevin Hassett being a frontrunner.

Investors are now looking out for November's non-farm payrolls and unemployment rate data, due on December 16, for further clues on the Fed's next move.

"Silver's fundamentals remain incredibly positive. There is a phenomenal tailwind with the critical minerals list and the possibility that we might see some stock building," which would further increase market tightness, Norman added.

Platinum gained 0.4 per cent to $1,662.15, while palladium fell 1 per cent to $1,461.50.

FAQs

Q1. What are platinum, palladium prices?

A1. Platinum gained 0.4 per cent to $1,662.15, while palladium fell 1 per cent to $1,461.50.

Q2. How is Silver price?

A2. Spot silver rose 1 per cent to $62.39 per ounce, after hitting a record high of $62.88 earlier in the session, bringing its year-to-date gain to 116 per cent on strong industrial demand, declining inventories and its addition to the U.S. critical minerals list.