XAU Rises on Fed Rate Cut Optimism

Gold prices climbed on Wednesday, December 11, 2024, as the latest inflation data increased the likelihood of a Federal Reserve interest rate cut next week.

Spot gold gained 0.7% to $2,713.29 per ounce, while U.S. gold futures rose 1.4% to $2,756.00. The U.S. Consumer Price Index (CPI) for November came in line with expectations, showing a monthly increase of 0.3% and an annual increase of 2.7%.

Market analysts believe that the benign inflation data will allow the Fed to cut rates at its upcoming meeting. Traders are now pricing in a 96% chance of a 25-basis-point rate cut on December 17-18.


Gold, often seen as a safe-haven asset, tends to benefit from lower interest rates. Some analysts predict that gold could reach $3,000 per ounce by the end of 2025, driven by easing bond yields and ongoing geopolitical risks.

In addition to gold, silver gained 0.5% to $32.07 per ounce, while platinum declined 0.8% to $934.60. Palladium, however, rose 1.2% to $979.46.