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Gold prices climbed in Asian trading on Tuesday, extending strong overnight gains as expectations grew that the U.S. Federal Reserve will cut interest rates in December. A wave of upcoming U.S. economic data also boosted safe-haven demand, helping gold trend higher even as the dollar held firm. Broader metal markets advanced as well.
Spot gold rose 0.3% to $4,145.57 an ounce, while February gold futures edged up 0.2% to $4,180.0/oz by 23:46 ET (04:46 GMT).
Rate-Cut Expectations Surge After Dovish Fed Signals
Markets have sharply increased their expectations for a December rate cut after two Federal Reserve officials voiced support for additional easing next month.
According to CME’s FedWatch Tool, traders now price a 77.2% probability of a 25-basis-point cut at the December 9–10 meeting, up from 41.8% just a week ago.
Lower interest rates typically support non-yielding assets like gold by reducing the opportunity cost of holding them. The metal has already logged a series of record highs this year following rate cuts at the Fed’s previous two meetings.
Safe-Haven Demand Remains Strong
Gold also drew support from heightened geopolitical tensions between China and Japan, as well as persistent concerns over aggressive fiscal spending in major developed economies.
Other Metals Advance
- Platinum gained 0.5% to $1,570.65/oz
- Silver rose 0.8% to $51.5555/oz
- LME copper futures jumped 1.2% to $10,887.0 per tonne
Markets Await Key U.S. Economic Data
Traders remained cautious ahead of several crucial U.S. releases expected over the coming days.
While the upcoming prints cover September, they are likely the most recent data the Fed will have before its December meeting due to the prolonged government shutdown in October.
- Producer Price Index (PPI) and retail sales data arrive later Tuesday
- PCE price index—the Fed’s preferred inflation gauge—is due Wednesday
U.S. officials have indicated that October inflation and labor data may not be released, which earlier contributed to expectations that the Fed might hold rates steady in December.
