Gold Prices Slide as Fed Signals Caution on 2025 Rate Cuts; Silver Also Dips

The dip comes as investors reacted to a hawkish tone from Fed Chair Jerome Powell and monitored ongoing U.S.–China trade negotiations, which together dampened demand for traditional safe-haven assets like gold and silver. International markets mirrored the trend, with spot gold falling below $4,000 an ounce, hitting a two-week low, and silver slipping to $46.77 per ounce, a 3.7% decline.

Analysts attribute the fall to a combination of profit booking, a stronger U.S. dollar, and easing geopolitical tensions, which reduced immediate demand for precious metals. “The market is adjusting after a strong rally, with investors locking in gains and awaiting key U.S. economic data and central bank signals,” noted Sanjay Kapoor, a commodities analyst.

Despite the recent decline, some experts point to long-term support for gold, especially amid global uncertainties. Investor Ray Dalio has highlighted that potential U.S. sanctions on Russia’s oil sector could weaken the dollar, potentially boosting gold demand, as seen in past instances where sanctions impacted fiat currencies.

Domestic markets, however, showed some resilience on Thursday, with gold and silver futures opening slightly higher in anticipation of upcoming U.S. inflation data. Traders are positioning themselves for potential market shifts, even as global prices remain under pressure.

This volatility comes ahead of Dhanteras 2025, traditionally considered an auspicious time for gold purchases. Analysts suggest that short-term fluctuations could present buying opportunities for investors, especially for those seeking to invest in physical gold, digital gold, or ETFs.

Key Takeaways for Investors:

·         Domestic gold prices: Rs 1,18,995/10 gm (MCX December futures).

·         Domestic silver prices: Rs 1,44,637/kg.

·         Global spot gold: Around $4,019/oz.

·         Global silver: $46.77/oz.

·         Factors influencing prices: Fed’s rate policy, U.S.-China trade talks, dollar strength, profit booking, easing geopolitical risks.

Analysts advise caution for short-term traders but note that long-term fundamentals for precious metals remain robust, with gold continuing to serve as a hedge against inflation and economic uncertainty.