Gold near $4,400, silver at records of $69 as markets price in more Fed rate cuts

Gold and silver prices are capping a historic year with fresh record highs, driven by a potent mix of easing monetary policy expectations, geopolitical uncertainty, and strong investor demand across global markets.

Spot gold surged to an all-time high of $4,383.73 per ounce on Monday, extending a rally that has gathered pace over the past two weeks. The precious metal has climbed nearly 67% so far this year, buoyed by expectations of further US Federal Reserve rate cuts after last week’s quarter-point reduction. Traders are now pricing in two US rate cuts in 2026, even as recent economic data has offered limited clarity on the growth and inflation outlook. US President Donald Trump has also publicly advocated for more aggressive rate reductions, reinforcing market expectations of looser monetary policy.

In India, domestic prices saw marginal profit-taking in early trade on Monday. 24-carat gold slipped ₹10 to ₹1,34,170 per 10 grams, while 22-carat gold eased Rs 10 to ₹1,22,990. 

Gold’s rally has also been fuelled by sustained safe-haven demand amid ongoing geopolitical and trade tensions, alongside robust central bank buying. According to World Gold Council data, gold-backed exchange-traded funds (ETFs) have recorded inflows for five consecutive weeks, with total holdings rising in every month this year except May. Bloomberg data shows ETF investors are increasingly competing with central banks for limited bullion supplies.

Lower interest rates tend to support gold and silver prices, as both metals are non-yielding assets and become more attractive when returns on bonds and cash fall. A softer dollar has added to gold’s momentum, making it cheaper for overseas buyers. The US dollar index has weakened in recent weeks, providing an additional tailwind.

Silver at all-time high

Silver, meanwhile, has also surged to record levels. The white metal rose to $69 an ounce, supported by speculative inflows and lingering supply tightness following a historic short squeeze in October. Trading volumes in Shanghai silver futures spiked earlier this month to levels close to those seen during the earlier market crunch, highlighting renewed investor interest. Silver has more than doubled this year, marking its strongest annual performance since 1979.

Silver prices declined by ₹100 to ₹2,13,900 per kilogram. Regionally, 24-carat gold was priced at ₹1,34,170 in Mumbai and Kolkata, ₹1,35,270 in Chennai, and ₹1,34,320 in Delhi.

Rahul Kalantri, VP Commodities, Mehta Equities, said: "Gold and silver prices advanced last week and began the new week by touching fresh lifetime highs in both domestic and international markets. The rally followed the U.S. Federal Reserve’s third interest rate cut of 25 basis points this year. Further support came from softer U.S. CPI inflation, which eased to 2.7% year-on-year, strengthening expectations of additional rate cuts next year. Meanwhile, the Bank of Japan raised interest rates by 25 basis points, but its less-hawkish-than-expected stance provided additional support to precious metal prices. Gold has support at $4320-4285 while resistance at $4400-4425. Silver has support at $66.40-65.75 while resistance is at $67.20-68.00. In INR gold has support at Rs1,33,550-1,33,010 while resistance at Rs1,35,350-1,35,970. Silver has support at Rs2,07,450-2,06,280 while resistance at Rs2,09,810, 2,10,970."

Looking ahead, optimism remains strong. Goldman Sachs analysts have set a base-case target of $4,900 an ounce for gold next year, with risks skewed to the upside, as precious metals continue to benefit from tight supply, policy uncertainty, and persistent global demand.