How rate-cut expectations are driving gold and silver prices higher?

Gold and silver extended their rally on Friday, November 28, as mounting expectations of a US Federal Reserve rate cut in December continued to support global bullion markets. Anticipation of monetary easing, combined with a weaker US dollar, helped push gold toward a fourth consecutive monthly gain while lifting silver to multi-month highs.

Spot gold increased 0.8% to $4,189.61 per ounce by 03:03 GMT, marking its highest level since November 14, and is on track for weekly and monthly gains of about 3% and 3.9%, respectively. US December gold futures rose 0.5% to $4,221.30 an ounce, while silver jumped 1.4% to $54.18 per ounce.

The main catalyst behind the rally has been growing confidence that the Fed will cut rates next month. CME FedWatch data shows traders now assign an 87% chance of a December rate reduction, up sharply from 50% a week ago. Thin market liquidity has amplified movements, with dovish remarks from Fed officials, including Mary Daly and Christopher Waller, along with Kevin Hassett, reinforcing expectations for policy easing.