Gold prices edged higher on Monday (December 15), supported by a softer US dollar and easing Treasury yields, as investors assessed the US Federal Reserve’s policy outlook ahead of key labour market data. Silver prices steadied after a sharp rally last week that pushed the metal to all-time highs.
Spot gold rose 0.4% to $4,320.65 an ounce in early trade, extending its strong performance this year, with bullion up about 64% an ounce year to date. US gold futures gained 0.6% to $4,354 an ounce.
In India, 24-carat gold traded at ₹13,473 per gram, while 22-carat and 18-carat gold stood at ₹12,350 and ₹10,105 per gram, respectively.
The dollar hovered near a two-month low, increasing the appeal of dollar-denominated commodities for overseas buyers, while benchmark 10-year US Treasury yields edged lower.
Market participants remain focused on upcoming US non-farm payrolls data for signals on the Fed’s next moves.
The Federal Reserve cut interest rates by 25 basis points last week in a rare split decision but signalled a possible pause as inflation remains sticky and the labour market outlook uncertain. Investors are currently pricing in two rate cuts next year.
Lower interest rates typically support non-yielding assets such as gold by reducing the opportunity cost of holding them.
Silver prices rose 0.8% to $62.48 an ounce, after touching an all-time high of $64.65 an ounce on Friday (December 12) before retreating on profit-taking. The metal has gained about 115% so far this year, driven by tightening inventories, strong industrial demand and its inclusion in the US critical minerals list.
However, analysts have flagged near-term downside risks, citing stretched valuations relative to gold and the possibility of fund rotation.
In India, silver traded at ₹210 per gram, or ₹2.10 lakh per kilogram.
Market participants also tracked domestic policy developments, including India’s move to allow pension funds to invest in gold and silver exchange-traded funds (ETFs). Analysts see this as a potential boost to institutional participation and investor confidence in precious metals.
Outlook
Rahul Kalantri, VP Commodities, Mehta Equities, noted that volatility may persist in the near term, though gold and silver are expected to find support at $4,155 and $59.20 per troy ounce, respectively.
Colin Shah, MD, Kama Jewelry, added, “The gold market continued to showcase strong resistance this week as international gold held fort at higher levels maintaining $4,200 per ounce. Domestically, wedding season-led demand in India remains an important support factor for jewellery demand, keeping sales momentum sustained. As long as there are no surprise factors relating to interest rates and currencies, gold will have a bias with a strong uptrend.”
–With Reuters inputs