Gold eased on Thursday, pulling back from a near one-week high, after the U.S. Federal Reserve delivered a divided interest rate cut that left investors uncertain about the pace of easing next year, while silver notched another record high.
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Gold edged lower on Thursday, as traders weighed the U.S. Federal Reserve’s divided vote on a quarter-percentage-point interest rate cut, while silver climbed to yet another record high.
Spot gold fell 0.3% to $4,216.49 per ounce. U.S. gold futures for February delivery gained 0.5% to $4,244.40 per ounce.
“It’s just an overpositioning (in gold) in expectation of the rate cut, which did happen, and therefore you’re seeing some selling pressure,” said independent analyst Ross Norman, adding that gold’s fundamentals remained intact.
The Fed cut interest rates by a quarter of a percentage point on Wednesday in a rare divided vote, but signalled a pause on further easing as officials look ahead to assess the direction of the job market and inflation that “remains somewhat elevated.”
Lower interest rates typically benefit non-yielding assets such as gold.
Projections issued after the two-day meeting showed most policymakers see just one rate cut in 2026. Fed Chair Jerome Powell offered no indication of when another cut might occur.
U.S. President Donald Trump said on Wednesday that the Fed’s rate cut could have been larger. Trump is set to announce the new Fed chair early next year, with White House economic adviser Kevin Hassett seen as a frontrunner.
Investors are now looking out for November’s non-farm payrolls and unemployment rate data, due on December 16, for further clues on the Fed’s next move.
Spot silver rose 0.6% to $62.16 per ounce, after hitting a record high of $62.88 earlier in the session, bringing its year-to-date gain to 115% on strong industrial demand, declining inventories and its addition to the U.S. critical minerals list.
“Silver’s fundamentals remain incredibly positive. There is a phenomenal tailwind with the critical minerals list and the possibility that we might see some stock building,” which would further increase market tightness, Norman added.
