Gold prices slipped slightly in Asian trading on Thursday, easing from their recent surge as traders weighed growing expectations of a December interest rate cut by the Federal Reserve.
Speculation surrounding who might succeed Fed Chair Jerome Powell — with markets betting on a more dovish replacement — added to the belief that U.S. rates may trend lower over the long term. A series of soft economic readings out of the U.S. helped reinforce that view.
The dollar weakened on these expectations, lending support to metals overall this week. Silver continued to outperform, moving close to record levels, while platinum saw a strong rebound on Thursday.
Spot gold dipped 0.3% to $4,152.35 an ounce by 00:08 ET (05:08 GMT). Gold futures were down 0.4% at $4,184.15 per ounce.
Investors Lean Into Expectations of a Rate Cut
Even with Thursday’s minor decline, spot gold remained more than 2% higher for the week as traders continued pricing in a strong chance of easing at the Fed’s next meeting.
Markets are now assigning a 79.8% probability of a 25-basis-point cut on December 9–10 — a sharp jump from just 24% last week, according to the CME FedWatch tool.
Sentiment shifted after two Fed officials publicly backed the idea of a December cut. Weak U.S. economic numbers also fueled expectations that policymakers may need to turn more supportive to prevent a deeper slowdown.
Safe-haven interest was another factor lifting gold earlier in the week. Limited movement on a U.S.-brokered Russia–Ukraine ceasefire, along with rising tensions between Japan and China, helped drive demand for the metal.
Other precious metals softened slightly alongside gold: spot silver slipped 0.7% to $52.9525 per ounce, while platinum jumped 1.7% to $1,616.76 per ounce despite the absence of a clear catalyst.
Lower interest rates typically boost appeal for non-yielding assets like gold, as investors tend to rotate out of government bonds in a declining-rate environment.
Fed Chair Succession Takes Center Stage
Reports this week indicated that Kevin Hassett — currently Director of the White House National Economic Council — is seen as the top contender to replace Powell when his term ends in May 2026.
Hassett, widely regarded as a close ally of President Donald Trump, is expected to advocate more aggressively for reduced interest rates.
As ANZ analysts wrote, “The White House National Economic Council Director is seen as a close ally of the US President and would likely be perceived as someone who would bring the president’s approach to interest-rate cutting to the Fed.”
Trump has frequently called for sharply lower interest rates to stimulate the U.S. economy, although Fed officials have resisted those demands given ongoing inflation concerns.
But several policymakers have recently signaled a shift in priorities, saying that stabilizing the labor market now “took immediate precedence,” and that price pressures could moderate in the coming months.