Gold Climbs as Silver Hits $60 Record and Markets Eye Fed’s Next Move
Gold had a strong day on Wednesday - traders are really positioning themselves ahead of the Federal Reserve's policy announcement...
Quick overview
- Gold prices surged as traders anticipate a Federal Reserve rate cut this week, supported by a weaker dollar and increased investment in safe-haven assets.
- Silver reached an unprecedented $60 an ounce, driven by rising industrial demand and ongoing supply shortages, particularly in clean energy sectors.
- The Silver Institute predicts significant demand growth for silver by 2030, exacerbated by declining global inventories and unresolved supply deficits.
- Market expectations for a 25 basis point rate cut by the Fed are high, influencing both gold and silver prices as traders await further guidance.
Gold had a strong day on Wednesday – traders are really positioning themselves ahead of the Federal Reserve’s policy announcement this week – lots of people are pretty sure another rate cut is coming. The metal has also benefited from the dollar being a bit softer and a steady flow of money into haven assets. At the same time, silver has continued its impressive run and even touched an unprecedented $60 an ounce – briefly, at least.
Industry data is further fueling silver’s surge. The Silver Institute has been saying demand from solar manufacturing, EVs, charging networks, data centers, and even AI systems is going to shoot up over the next few years, and all that – by 2030 in fact. With tight supplies and falling global inventories already on the scene, the shortage worries are getting a lot worse.
Maria Smirnova of Sprott Asset Management was quoted as saying the silver supply deficit has still not been resolved, and that’s the sort of thing that sets silver’s long-term direction, not to mention it’s already affecting how the market thinks about supply.
Fed rate Cut Expectations Keep Building
The Federal Reserve has its two-day meeting on Wednesday, and the futures markets reckon there’s a whopping 87.4 % chance of a 25bp cut – as expected.
Traders are now watching whether the Fed makes it clear they’re going to keep easing in the early part of 2026 – that’ll be interesting to see. Bob Haberkorn of RJO Futures said gold’s move is partly being driven by silver’s momentum – and of course, the anticipation of another rate cut has kept a lid on interest rates, and that has the precious metals on the up.
And in other macro news, the latest US jobs report showed 7.67 million job openings in October – a lot more than people were forecasting – so despite the overall slowdown in hiring, there are still some areas of resilience in the labour market.
Silver Continues to Outperform as Supply Remains a Problem
Silver’s big jump is all down to a combination of it being wanted by industry for clean energy and all that, plus the fact that there just isn’t much of it around – and of course, now it’s on that US list of critical minerals, it has got the long-term investors really excited about all this.
Some of the key drivers that are pushing silver higher are:
- It’s getting used in more clean energy & AI-related infrastructure.
- There is also the supply issue: global inventories are falling.
- And with the US monetary authorities expected to ease up a bit.
Gold Price Forecast – A Look At The Charts
Gold is currently trading at $4206, still within the rising channel that has been guiding the price since mid-November. The buyers have been defending the trendline support at $4177, while the 20-day EMA at $4204 has flattened, suggesting a pause in momentum.
We have got a bit of resistance in the middle of the channel near $4240 – that has been a ceiling, and the repeated long upper wicks suggest the price is being held back. Sustained break above that, and we could see gold retest $4263. Suppose the trendline does fail; there’s some support at $4130, then at $4083. With the RSI sitting at 51, we’re hovering there – momentum is pretty balanced, at least for now, and it’s all waiting for the Fed to give us a steer.
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