Key Moments
- Spot gold dipped 0.1% to $4,326.89 per ounce but was still on track for a weekly gain of about 0.4%.
- Silver and platinum outperformed, with weekly advances of 6% and 10.5% respectively, remaining near record highs.
- Softer-than-expected U.S. CPI data and rising economic uncertainty boosted safe haven demand and bets on further Federal Reserve rate cuts.
Gold Eases but Holds Weekly Gain
Gold prices slipped in Asian trading on Friday, yet the metal remained poised to close the week slightly higher, even as other precious metals logged stronger gains. The move came in the wake of weaker-than-expected U.S. inflation data that reinforced expectations for additional interest rate reductions by the Federal Reserve.
Spot gold edged down 0.1% to $4,326.89 an ounce, hovering near an October record high. Gold futures for February delivery declined 0.2% to $4,354.70 per ounce by 00:48 ET (05:48 GMT). Despite the modest pullback, bullion prices were up about 0.4% for the week.
The broader precious metals complex advanced even as the dollar saw a slight recovery from recent weakness. Safe haven demand remained a key theme, supporting prices across the sector.
Silver and Platinum Lead Weekly Performance
Silver and platinum significantly outpaced gold on Friday and over the course of the week, with both metals trading close to their record highs amid robust safe haven inflows.
| Metal | Type | Price | Move on Day | Weekly Performance |
|---|---|---|---|---|
| Gold | Spot | $4,326.89/oz | -0.1% | +0.4% |
| Gold | Futures (February) | $4,354.70/oz | -0.2% | Not specified |
| Silver | Spot | $65.8365/oz | +0.5% | +6% |
| Platinum | Spot | $1,937.50/oz | +0.6% | +10.5% |
| Palladium | Spot | $1,709.20/oz | +1.4% | +14% |
Spot silver climbed 0.5% to $65.8365 per ounce and was up 6% for the week, marking a fourth straight week of gains. Spot platinum advanced 0.6% to $1,937.50 per ounce and recorded a 10.5% weekly rise.
Other precious metals also strengthened on similar themes. Spot palladium gained 1.4% to $1,709.20 per ounce and was heading for a 14% jump over the week.
Safe Haven Demand and Supply Concerns Support White Metals
Investor demand for silver and platinum has outstripped that for gold in recent weeks, as market participants increased exposure to real world assets amid growing worries about slowing economic growth in developed economies.
Silver and platinum have been favored as alternatives that offer stability comparable to gold but at significantly lower price levels relative to the yellow metal, particularly after gold’s strong rally over the past year.
Expectations of supply shortages in silver and platinum in the coming year have further underpinned interest in these metals.
Fed Rate Cut Bets Rise After Softer U.S. CPI
A broad move higher in metal prices followed the release of U.S. consumer price index inflation data for November, which came in softer than anticipated. The data bolstered confidence that the Federal Reserve could implement more interest rate cuts.
However, analysts cautioned that the November inflation data may have been distorted by a prolonged government shutdown in October and early November. Goldman Sachs analysts noted that the December CPI report is likely to be more important for gauging the trajectory of U.S. inflation and interest rates, and that the November figures are unlikely to play a major role in shaping the Fed’s outlook.
Economic Uncertainty Fuels Haven Flows
Uncertainty surrounding the U.S. economic outlook has been a key driver of safe haven demand this week. An unexpected increase in unemployment has raised concerns about stagflationary risks for the U.S. economy, prompting investors to seek protection in precious metals, including gold, silver, platinum, and palladium.
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