Gold Prices Climb Amid Fed Rate Cut Speculation and Economic Growth Concerns
Spot and futures gold climb as investors weigh December rate cut and global growth concerns
Mumbai, Nov 10: Gold prices surged on Monday, supported by expectations of a potential Federal Reserve interest rate cut in December and a wave of weak economic indicators raising global growth concerns.
Spot gold rose 0.7% to $4,027.88 per ounce by 0115 GMT, while U.S. gold futures for December delivery advanced 0.7% to $4,036.60 per ounce.
The U.S. economy lost jobs in October, driven by declines in government and retail sectors, while cost-cutting measures and AI adoption prompted a surge in announced layoffs. Consumer sentiment also weakened to its lowest level in nearly three-and-a-half years amid concerns over the economic fallout from the 40-day federal government shutdown.
Market participants now see a 67% chance of a December Fed rate cut, according to the CME FedWatch Tool. Historically, non-yielding gold benefits in low-interest-rate environments and during periods of economic uncertainty.
On Sunday, the U.S. Senate appeared ready to advance a measure to reopen the federal government, potentially ending the historic shutdown that disrupted federal services, food aid, and air travel. Optimism over a resolution helped lift global shares in Asia, while the U.S. dollar remained soft.
SPDR Gold Trust, the world’s largest gold-backed ETF, reported a 0.16% rise in holdings to 1,042.06 tonnes on Friday from 1,040.35 tonnes on Thursday.
Physical gold demand in India remained subdued last week due to price volatility, while dealers offered steep discounts to attract buyers. Demand in China also cooled following changes in tax regulations.
Other precious metals saw gains as well, with spot silver rising 1.1% to $48.84 per ounce, platinum climbing 1.2% to $1,563.25, and palladium up 1.2% to $1,396.75.
