WASHINGTON (dpa-AFX) - Gold prices rose on Tuesday ahead of Wednesday's U.S. Federal Reserve's interest rate decision wherein the markets price in a quarter-point rate cut announcement amid ongoing geopolitical uncertainty.
Front Month Comex Gold for December delivery climbed by $19.50 (or 0.47%) to $4,206.70 per troy ounce.
Front Month Comex Silver for December delivery skyrocketed by $2.3900 (or 4.14%) to $60.169 per troy ounce. Notably, this is a new record high for silver prices.
Last weekend, the U.S. Personal Consumption Expenditure data revealed the price index rose 0.20% in September. On an year-on-year basis, the core PCE price index rose by 2.8% from September 2024.
Last week's private data on employment revealed a rise in layoffs.
Today, data released by Automatic Data Processing revealed that private employers added an average of 4,750 jobs per week in the four weeks ending November 22.
The latest Job Openings and Labor Turnover Survey (JOLTS) reported that job openings increased by 12,000 to 7.670 million in October, up from 7.658 million in September. The numbers for September showed a 431,000 jump from August's 7.227 million.
The figures for both months have surpassed expectations of 7.2 million.
The NFIB Small Business Optimism Index rose to 99 in November, the highest in 3 months, compared to 98.2 in October.
The U.S. economy has experienced serious headwinds this year due to tariff-triggered inflation as well as weakening in the job market. Layoffs were implemented by several companies, especially in the information technology sector.
Against this backdrop, the U.S. Federal Reserve's two-day meeting has commenced today. The Fed will announce its interest rate decision on Wednesday.
Data available so far indicates a conflicting scenario, making the Fed's responsibility to serve its dual mandate tedious, with increase in layoffs on the one hand and rising inflation on the other.
However, traders are optimistically pricing in another rate cut announcement along with warnings on inflation by the Fed.
CME Group's FedWatch Tool is currently indicating that investors are betting on an 87.4% chance of a 25-basis-point interest rate cut by the Fed.
Efforts undertaken by U.S. President Donald Trump's administration to bring an end to the Russia-Ukraine war have been unsuccessful so far.
On Sunday, Trump hinted that Russia was 'fine' with the current proposal formulated by the U.S. but added that he was disappointed with Ukraine President Volodymyr Zelenskyy.
Zelenskyy disagreed with the U.S. peace plan as he is unwilling to cede any territory to Russia.
The BBC reports that Ukraine is readying a revised peace proposal which it will present to the White House.
Much of investors' attention is now fixated on the policy outlook and interest rate trajectory of the central bank, which would be disseminated from the Fed Chair Jerome Powell's speech following the new rate announcement.
So far this year, gold has risen by around 60%. Persistent buying by central banks of major nations, prevailing geopolitical tension and ongoing global economic uncertainty have supported the safe-haven characteristic of the yellow metal.
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