US Treasury yields continue to weigh on gold, supported by the Federal Reserve’s hawkish stance, which points to slower rate cuts through 2025. Moreover, robust global equity markets limit gold’s safe-haven appeal.
“Geopolitical risks remain a key factor supporting gold prices,” analysts said, pointing to ongoing conflicts in Eastern Europe and the Middle East.
Silver performs better when investors seek safe havens
Silver (XAG/USD) is trading at $29.68 and climbing to an intraday high of $29.76. The metal has benefited from its relatively lower price compared to gold, making it an attractive alternative for risk-averse investors. While the strength of the US dollar poses challenges, silver is buoyed by its dual role as a safe haven and industrial metal.
“Silver’s accessibility and broad appeal make it a resilient investment option in uncertain times,” market experts said. The metal’s recent momentum is further supported by heightened geopolitical tensions and a marginally positive industrial outlook.
The US dollar weakens slightly due to cooling inflation
The US Dollar Index (DXY) retreated from recent highs after November’s Personal Consumption Expenditure (PCE) price index pointed to a cooling inflation trend. Core PCE rose 2.8% year over year, matching October levels but missing the 2.9% forecast. Personal income grew 0.3%, while consumer spending rose 0.4%, indicating subdued economic activity.
Looking ahead, traders are closely watching the Conference Board’s Consumer Confidence Index, due out Monday, for clues about future dollar movements.