Fundamental News and Triggers
Weak payroll data fuel precious metals rally
- Gold and silver remain at record highs, as investors gain confidence in a Federal Reserve rate cut next week and ETF inflows continue. Silver-backed ETFs added almost 200 tons on Tuesday, bringing overall holdings to their highest level since 2022 due to strong demand.
- ADP figures for November revealed an unexpected fall of 32,000 private-sector jobs, considerably below expectations for a 10,000 increase and the third drop in four months. This is the steepest hiring slowdown since 2023, fueling concerns about a slowing US labour market.
- The news was consistent with dovish comments from Fed policymakers, who underlined the need to address slowing employment creation. In response, rate futures priced in a roughly 90% possibility of a 25-basis point cut next week.
- Silver has risen 100% this year due to concerns about market liquidity, following outflows to US and Chinese inventory, inclusion on the US vital minerals list, and a structural supply deficit.
Technical Triggers
- Gold has started its upward journey again; the next target is $4300 (~Rs 132,000) and $4345 (~Rs 133,500) with strong support at $4200 (~Rs 129,000).
- Silver can continue its rally towards $60 (~Rs 185,500) and $62 (~Rs 191,000), with firm support at $57 (~Rs 177,000), if tight supply conditions continue.
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