Silver hits record high as Gold eases ahead of Fed decision
|Gold prices eased slightly in early U.S. trading, while silver surged to fresh record highs, continuing its impressive run.
The market was largely subdued ahead of the Federal Reserve’s policy announcement, with investors anticipating a 0.25% rate cut.
However, attention is centered on the Fed’s guidance on future monetary policy, especially amid concerns over persistent inflation, which could lead to a more hawkish stance.
Global bond yields have climbed to levels not seen since 2009, suggesting the era of aggressive rate cuts may be nearing its end.
Investors are increasingly wary of inflation risks and mounting government debt, leading to a shift in expectations across central banks, including in the U.S. and Europe.
In China, consumer inflation jumped to a 21-month high in November, driven by rising food and non-food prices.
Meanwhile, producer prices continued to decline, highlighting ongoing deflationary pressures in the manufacturing sector.
In commodities regulation, the U.S. Commodity Futures Trading Commission (CFTC) announced it would eliminate its backlog of Commitments of Traders reports by the end of December, ahead of its previous January 2026 timeline.
Gold’s technical setup remains bullish overall, with key resistance at $4,433 and support around $4,100.
Silver, on the other hand, has broken out of a bullish pattern and continues to outperform gold. Silver is currently targeting the $65 level, with strong support near $57.
Silver’s rally, up more than 100% this year, is fueled by robust industrial demand, investment interest, and lingering supply constraints.
While inflows into silver-backed exchange-traded products (ETPs) remain strong, rising inventories in London suggest the market may be easing slightly.
Despite this, analysts caution that silver could see near-term volatility but maintain a positive long-term outlook.
The narrowing gold/silver ratio, now at its lowest since July 2021, further underlines silver’s strong performance.
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