Gold prices surged to a seven-week high, hitting above $4,275 per ounce on Friday, while silver approached a record peak of $64.31 on the Comex exchange, following a 25 basis point interest rate cut by the US Federal Reserve, lowering rates to a range of 3.50 percent to 3.75 percent.
The rally in precious metals was fueled by remarks from Fed Chair Jerome Powell, which were interpreted as slightly dovish, leading traders to raise expectations for additional monetary easing. The Fed’s announcement of plans to purchase approximately $40 billion in short-dated Treasury bills is intended to alleviate strains in money markets, a move anticipated to limit upward pressure on short-term yields and bolster bullion prices.
Gold surpassed a crucial near-term resistance level of $4,240, recording over a 1 percent gain during the session. Comex gold remains above its 20-day exponential moving average near $4,200, with the next resistance zone targeted at $4,350. In India, MCX gold reached all-time highs near ₹1,32,776, supported by a lower support level at ₹1,31,400.
Silver outperformed gold in both global and domestic markets, decisively breaking past the $64 mark to attain a new 52-week high. The increase in silver prices was bolstered by concerns regarding supply constraints, stimulus measures from China, and heightened inflows into exchange-traded funds (ETFs). Comex silver surpassed its upper channel resistance at around $63.80, and analysts anticipate that the metal will sustain positive momentum as long as it remains above $60.
“Lower rates reduce the opportunity cost of holding non-yielding assets like gold and silver, attracting fresh investment flows,” remarked Hareesh V, Head of Commodity Research at Geojit Investments Limited. He highlighted that the weakening of the U.S. dollar following the rate cut further supported prices, making metals more accessible for global buyers.
The dollar index fell to a two-month low, enhancing the appeal of bullion. Domestic gold prices in India also received additional support due to the depreciation of the rupee against the dollar.
Published on December 12, 2025.
