Gold prices stabilized above the $4,200 mark on Tuesday as investors positioned themselves ahead of the Federal Reserve’s upcoming interest rate announcement, while silver extended its dramatic rally to unprecedented levels.
Market sentiment remained firmly bullish, driven by expectations of monetary easing, tightening supplies, and robust industrial demand across key sectors such as renewable energy and advanced manufacturing.
Traders said that momentum in silver helped reinforce confidence in the broader precious metals complex, even as economic data continued to show resilience in the U.S. labor market. With policy uncertainty at the forefront, investors are closely watching the Fed’s decision for signals that could define the next phase of price action in both gold and silver.
Gold Prices Advance Despite Strong Job Market
Spot gold rose 0.6% to $4,211.77 per ounce by late afternoon, while U.S. gold futures for February delivery settled 0.4% higher at $4,236.2. The upward move came in spite of labor market data that exceeded expectations.
The latest Job Openings and Labor Turnover Survey (JOLTS) showed that job vacancies increased to 7.67 million in October, beating forecasts of 7.15 million and confirming ongoing strength in the U.S. economy.
Typically, such resilience would pressure Gold prices because it reduces the likelihood of aggressive rate cuts. However, analysts said sentiment was being driven less by the data and more by what investors expect from policymakers. According to Bob Haberkorn, senior market strategist at RJO Futures, “the current rally in gold is tied to the surge in silver and the strong conviction that another quarter-point cut is coming.”
Market-based indicators reflect that view, showing an 87.4% chance of a 25-basis-point reduction this week. The Fed is scheduled to announce its decision on Wednesday at the end of its two-day meeting.
Silver Hits All-time High on Supply Concerns
While Gold prices were climbing steadily, silver dominated headlines by jumping 4.3% to $60.74 per ounce, marking an all-time high. Traders and analysts said a combination of supply shortages and booming industrial usage has driven the metal sharply higher.
“People are anticipating strong industrial demand for years to come, which is why the silver price has been bid up,” said Fawad Razaqzada, market analyst at City Index and FOREX.com. He pointed to growth in solar panels, electric vehicles, battery technology, and artificial intelligence as key forces supporting demand.
A recent report from the Silver Institute projects that industrial consumption will continue rising through 2030. At the same time, both mined output and recycling volumes have been unable to meet demand, pushing inventories lower worldwide. The deficit has also been amplified by silver’s addition to the U.S. critical minerals list.
Maria Smirnova, senior portfolio manager and chief investment officer at Sprott Asset Management, said that without structural supply changes, prices are likely to remain elevated. “Unless we fix the deficit, silver only has one way to go, and that is up,” she said.
Industrial Demand Drives Optimism
The broader outlook for metals is being shaped increasingly by the transition to clean energy and the expansion of global data infrastructure.
Silver is expected to play an essential role in solar energy, autonomous vehicles, semiconductor fabrication, and high-performance computing. These shifts, combined with slowing supply growth, have convinced many investors to take longer-term positions.
Gold prices have benefited from the same trend, but with a different primary driver. While silver is tied more closely to industry, gold remains a major store of value, especially in times of policy uncertainty. Analysts said the expectation of rate cuts has supported inflows into gold as investors seek protection against inflation and market volatility.
“Even though the labor market remains strong, the interest rate outlook is more important for sentiment right now,” said one strategist. Rising Gold prices reflect that view, as traders prepare for a more accommodative central bank.
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Gold Prices Seen Reaching $5,000
Market strategists are increasingly confident that the upward trend in Gold prices could continue over the next year. Haberkorn said gold is “on a path toward $5,000 an ounce” as the easing cycle develops. Silver, meanwhile, could trade above $70 an ounce in the first half of 2026, according to his projections.
Other precious metals joined the rally on Tuesday. Platinum rose 2.8% to $1,688.39 per ounce, while palladium gained 2.6% to $1,503.74. Although these markets are smaller and more specialized, their performance added to the perception that bullish sentiment is broad-based.
Also read: Gold Prices Stabilize Above $4,200 on Growing Rate Cut Expectations
Even so, analysts cautioned that volatility will remain high. Metals markets are prone to sudden reversals driven by macroeconomic headlines, shifts in investor positioning, or changes in currency valuations. Pullbacks are expected, even if the long-term trend remains positive.
For now, the focus is squarely on the Federal Reserve. A dovish message could reinforce the ongoing rally and push Gold prices to new territory. If policymakers signal uncertainty or delay easing, short-term volatility may increase.
As traders await Wednesday’s announcement, precious metals remain in the spotlight. With Gold prices rising and silver breaking records, the market is preparing for what could be another dramatic leg higher in the weeks ahead.
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