Gold Prices Gain Amid Fed Rate Cut Speculation and Dollar Weakness

Gold prices advanced 0.3% to $4,209.43 per ounce as the U.S. dollar hovered NEAR a five-week low, amplifying the metal's appeal for international buyers. Market participants now price in an 88.4% probability of a 25-basis-point Fed rate cut at this week's policy meeting, according to CME Group data.

The precious metal's rally coincides with silver reaching a record $59.32 per ounce, completing a 100% year-to-date surge. Weak economic indicators—including sluggish private payroll growth and tempered consumer spending—have cemented expectations for monetary easing. Lower interest rates typically enhance the attractiveness of non-yielding assets like Gold by reducing their opportunity cost.

Currency markets amplified the move, with the dollar index testing one-month lows. The inverse relationship between the greenback and dollar-denominated commodities remains a key price driver. All eyes now turn to the December 9-10 FOMC meeting, where policymakers could formalize the market's dovish expectations.