Gold, Silver Rally On Fed Rate Cut Hopes, US Shutdown Resolution

Gold and silver prices rallied in the futures trade on Tuesday tracking firm global trends amid easing concerns over the US government shutdown and growing expectations of a rate cut by the Federal Reserve in its December meeting.

On the Multi Commodity Exchange (MCX), gold futures for December delivery extended the gains for the fourth consecutive day appreciating Rs 725, or 0.58% to Rs 1,24, 695 per 10 grams. Similarly, the February 2026 contract for the yellow metal futures surged by Rs 736, or 0.59% to Rs 1,26,101 per 10 grams.

Silver futures also saw the uptrend, with the December contract climbing Rs 639, or 0.42%, to Rs 1,54,330 per kilogram. The March 2026 contract climbed by Rs 632, or 0.4% to Rs 1,56,880 per kg on the commodities bourse.

'Gold and silver opened the week on a strong note amid expectations of a resolution to the US government shutdown, and growing anticipation of rate cuts in the December Fed meeting supported the rally.

'Weakness in the dollar index triggered profit-taking, while safe-haven demand further boosted prices,' Rahul Kalantri, Vice-President of Commodities, Mehta Equities, said.

In the international market, Comex gold futures for December delivery rose $18.75, or 0.45%, to $4,140.75 an ounce, while silver futures gained 0.08% to $50.35 per ounce.

'Gold rose above $4,130 per ounce, hitting a three-week high as growing economic uncertainty in the US fuelled expectations for a near-term Federal Reserve rate cut,' Jigar Trivedi, Senior Research Analyst at Reliance Securities, said. Meanwhile, US Federal Reserve Governor Stephen Miran recently signalled a larger 50 basis points rate cut to tackle rising unemployment and sluggish inflation.

Trivedi noted that private employment data last week showed job losses in October, particularly in the government and retail sectors, while consumer sentiment declined to a three-and-a-half-year low in early November.

Meanwhile, the US Senate moved a measure to reopen the federal government after a 40-day shutdown, which could partially capped the gains for the safe-haven asset.

On the market outlook, financial services firm JP Morgan projected that gold prices will remain supported in the longer term, expecting levels above $5,000 an ounce next year due to continued central bank buying.