DBT Bureau
Pune, 1 Dec 2025
Gold prices surged 1.44% to ₹1,29,504, driven by rising confidence in a December Federal Reserve rate cut. A wave of dovish commentary from Fed officials, along with weaker-than-expected delayed economic data, has strengthened market expectations. Remarks from Kevin Hassett—considered a top contender to succeed Jerome Powell—aligning with President Trump’s support for easing further boosted sentiment. As a result, markets now assign over 85% probability to a 25 bps cut next month, sharply higher from 30% a week earlier, while also pricing in three more cuts by end-2026. Gold is on track for its strongest annual performance since 1979, supported by heavy central-bank buying and robust ETF inflows. However, high prices have dampened retail demand across major Asian hubs. In India, even with the wedding season underway, dealers were forced to offer discounts up to $18/oz, narrower than last week’s $21. In China, demand softened further following the removal of a VAT exemption on certain gold purchases, with prices ranging from slight premiums to discounts of up to $16/oz. Singapore and Hong Kong saw modest premiums of $2.50 and $1.80 respectively. According to the World Gold Council, global gold demand rose 3% YoY to 1,313 tonnes, led by a 17% jump in bar and coin demand and 134% surge in ETF inflows. Technically, fresh buying is evident as open interest jumped 20.44% to 12,131 with prices gaining ₹1,837. Support lies at ₹1,28,400, below which ₹1,27,290 may be tested, while resistance is at ₹1,30,110, with potential toward ₹1,30,710 on a breakout.
Market Analysis:
- Gold trading range for the day is ₹127290-₹130710.
- Gold rose as markets grow increasingly confident of a Fed rate cut in December.
- A series of remarks from Fed officials supporting further monetary easing, along with delayed economic data.
- Kevin Hassett, considered a leading contender to replace Powell, has publicly backed Trump’s push for another rate cut.
Silver prices surged 5.42% to ₹1,74,981, supported by growing conviction that the US Federal Reserve will deliver further interest rate cuts. Market expectations for a 25 bps cut in December have jumped to 85%, up from 39% a week earlier, with three more cuts projected by end-2026. Sentiment strengthened after reports that Kevin Hassett, aligned with President Trump’s preference for lower rates, is the frontrunner to become the next Fed Chair. Since October, silver has repeatedly tested all-time highs, driven by global economic uncertainty, lower-rate prospects, and tightening physical supplies. COMEX inventories saw another sharp drawdown, with 7.6 million oz leaving warehouses, taking stocks to 462 million oz, the lowest since March. Meanwhile, LBMA inventories climbed to 844 million oz, the highest in a year, as arbitrage flows pushed metal from COMEX to London. Physical demand remains robust: India’s wedding season is lifting consumption, while potential US tariffs on silver add a new layer of risk. China’s silver ecosystem is also under stress, with SHFE stocks at their lowest since 2015 and SGE volumes at a nine-year low. Chinese exports surged to a record 660 tons in October, tightening domestic liquidity further. London vault holdings rose to 26,255 tons, up 6.8% MoM, helped by large inflows of US and Chinese silver that eased a severe liquidity squeeze. Technically, fresh buying is evident as open interest climbed 4.63% to 16,095, with prices rising by ₹8,994. Support stands at ₹1,69,475, below which ₹1,63,975 is possible. Resistance is at ₹1,77,980, and a breakout may extend gains toward ₹1,80,985.
Market Analysis:
- Silver trading range for the day is ₹163975-₹180985.
- Silver climbed amid growing expectations that the US Federal Reserve will cut interest rates further.
- Markets now price in roughly an 85% chance of a 25 basis point cut in December, up sharply from about 39% a week ago.
- The global silver market faces a fresh risk after Chinese stockpiles sank to the lowest in a decade.
Crude oil prices edged higher, settling 0.64% up at ₹5324, though the broader tone in the market stayed cautious due to persistent oversupply signals. Geopolitical developments added a layer of uncertainty, with the U.S.-proposed Russia-Ukraine peace plan facing hurdles as Russia placed firm preconditions. While President Putin conveyed readiness to explore talks based on President Trump’s proposals—raising hopes that sanctions on Russian crude could eventually ease—most market participants doubt a swift breakthrough. Global supply expectations continued to weigh heavily. OPEC+ restored additional capacity and set a December output increase of 137,000 bpd, while producers outside the alliance kept adding barrels. Deutsche Bank projected a 2026 surplus of at least 2 million bpd, and Goldman Sachs warned that the ongoing supply wave is likely to keep prices under pressure through 2026. The IEA also raised its supply forecasts for 2025 and 2026, highlighting widening imbalances as demand growth remains historically modest. U.S. data from the EIA added to bearish sentiment. Crude inventories rose sharply by 6.4 million barrels for the week ended November 7 and later by 2.8 million barrels for the week ended November 21. Technically, crude oil is in a short-covering phase, with open interest dropping 5.29% to 13,870. Immediate support lies at ₹5281, with further downside toward ₹5239. Resistance is placed at ₹5351, and a breakout above could open the path toward ₹5379.
Market Analysis:
- Crudeoil trading range for the day is ₹5239-₹5379.
- Crude oil edged higher as the success of a U.S. proposed peace deal to end the Russia-Ukraine war remains uncertain.
- Forecasts of a global glut grew as OPEC+ resumed capacity and producers outside the group increased output.
- Russia’s Novak said Moscow and Beijing have been discussing ways to expand Russian oil exports to China.
