Gold is on fire again. Spot prices jumped 0.3% to $4,150.09 an ounce Tuesday afternoon after touching the highest level in nearly two weeks, fuelled by growing certainty that the U.S. Federal Reserve will deliver a December rate cut.
Weak U.S. Data Lights the Fuse
September retail sales came in well below forecasts, signalling American consumers are finally tightening their belts. Meanwhile, producer prices rose a tame 2.7% year-on-year exactly in line with last month giving the Fed clear room to ease without igniting inflation.
Traders wasted no time. The probability of a December 9–10 rate cut has skyrocketed from 30% last week to 83% today. A January follow-up is now priced at 64%.
Fed Officials Pour Fuel on the Fire
Two influential governors turned openly dovish this week. Stephen Miran warned of a softening labour market that “justifies further easing,” while Christopher Waller had already hinted the same on Monday.
Lower rates make non-yielding gold far more attractive than bonds or cash — the classic recipe for a bull run.
Geopolitics Keeps the Floor High
Beyond the Fed, persistent global tensions and economic jitters continue to drive safe-haven buying. Analysts say even if rates pause later, uncertainty will keep gold supported well above $4,000.
Other Metals in Play
- Silver: steady at $51.40/oz
- Platinum: +0.4% to $1,550.31
- Palladium: +0.1% to $1,396.18
With the Fed meeting just two weeks away and markets betting big on cuts, gold bulls are firmly in control and $4,200 is already in sight.
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