Investor focus has also shifted to the Federal Reserve’s monetary policy amid expectations that President-elect Donald Trump’s economic strategies could drive inflation.
According to the CME FedWatch Tool, there is an 85% probability of a 25 basis point rate cut in December, but speculation about a pause in further cuts is strengthening the US Dollar, capping gold’s potential gains.
Silver Follows Gold’s Momentum, Trades Above $31.90
Silver prices mirrored gold’s strength, trading near $31.90 and reaching an intra-day peak of $32.06. The metal’s safe-haven status and its close correlation with gold have supported its gains.
Market uncertainty surrounding geopolitical instability and US economic policies has enhanced silver’s attractiveness as a store of value. However, like gold, silver’s rally faces resistance from a firming US Dollar.
China’s Role and Market Outlook
The People’s Bank of China’s renewed gold buying reflects broader global demand trends. Coupled with concerns over potential inflation stemming from Trump’s policies, this has solidified gold and silver as preferred hedges against economic and geopolitical uncertainties.
Traders now await the release of US consumer inflation data on Wednesday for further clues about the Federal Reserve’s trajectory. The interplay between geopolitical factors, China’s economic actions, and US policy shifts will remain pivotal in shaping the outlook for both gold and silver prices.
Source: Gold (XAU) Silver (XAG) Daily Forecast: China’s Gold Buying Fuels Price Gains
