(Kitco News) - Gold and silver prices are not straying too far from unchanged levels on day, in early U.S. trading Monday. Silver is flirting near its recent record highs. Both precious metals markets are pausing ahead of this week’s FOMC meeting. February gold was last down $2.40 at $4,240.50. March silver prices were down $0.198 at $58.85.
Global stock markets were mixed overnight. U.S. stock indexes are pointed to slightly firmer openings when the New York day session begins.
In overnight news, the World Bank reports China’s central bank added to its gold reserves for a 13th straight month, according to data released on Sunday. Bullion held by the People’s Bank of China rose by 30,000 troy ounces last month, bringing the total to around 74.12 million troy ounces. The current buying cycle began in November 2024. Central-bank purchases worldwide ramped up in October after a lull in the middle of the year, according to the Council.
Fed’s FOMC meeting begins Tuesday. The Federal Reserve’s Open Market Committee (FOMC) begins its monetary policy meeting Tuesday morning, with the meeting ending Wednesday afternoon with an FOMC statement and then a press conference from Fed Chair Jerome Powell. Markets are pricing in a 90% chance of a 0.25% U.S. interest rate cut at this week’s FOMC meeting. Markets are also pricing in a total of around 0.9% in U.S. interest-rate reductions for all of 2026. Market expectations are also that White House economic adviser Kevin Hassett will be nominated as the next Fed chair. Hassett is a monetary policy dove and is known for supporting faster interest rate reductions, in line with President Trump’s stance. Lower interest rates generally mean better risk appetite in the marketplace and in turn better speculator buying interest in the commodity futures markets.
U.S. Trade Representative: China complying with its U.S. trade commitments… U.S. Trade Representative Jamieson Greer said on Fox TV Sunday that China has been complying with the terms of the bilateral trade agreements and that the U.S. is constantly monitoring commitments made by China in a bid to maintain a stable trade relationship. “With China, it’s always we verify and we monitor and we watch the commitments. The commitments are quite specific,” Greer said on Fox News’ The Sunday Briefing and as reported by Bloomberg. “So all of these things that we’ve agreed to with the Chinese recently are very concrete, we can monitor them with some ease, and so far, we’re seeing that they’re in compliance.” Greer said
China’s exports to U.S. continue to decline. China’s shipments to the U.S. slumped by 28.6% in November, marking the eighth straight month of double-digit declines. China's overall trade surplus widened to $111.68 billion in November, up from $97.33 billion in the same month last year and surpassing expectations of $100.2 billion. It marked the largest trade surplus since June, as exports rose more than imports. China’s exports increased 5.9%, year-on-year, beating forecasts for 3.8% growth and rebounding from a 1.1% fall in October, boosted by a surge in shipments to non-U.S. markets amid China’s efforts to diversify export destinations and to deepen trade ties with ASEAN and EU countries.
Ukraine’s Zelenskiy suggests peace deal with Russia not close. Ukrainian President Volodymyr Zelenskiy said negotiators discussing a U.S.-brokered peace initiative remain divided over territory as President Trump expressed disappointment in Kyiv’s handling of the deal. Elements of the U.S. plan require further discussion on “sensitive issues,” including security guarantees for Ukraine and control over eastern regions, Zelenskiy said in a phone interview. He said talks have yet to reach agreement on Ukraine’s Donbas, including the provinces of Donetsk and Luhansk. “There are visions of the U.S., Russia and Ukraine — and we don’t have a unified view on Donbas,” Zelenskiy told Bloomberg early today. He said Kyiv is pushing for a separate agreement on security guarantees from Western allies, above all the U.S.
CME data outage on Nov. 28 due to human error. A Nov. 28 outage at a data center owned by CyrusOne caused markets operated by CME Group Inc. to be down for more than 10 hours was due to human error. Onsite staff and contractors failed to follow standard procedures for draining cooling towers ahead of freezing temperatures, resulting in the cooling system being overloaded and rising temperatures. CyrusOne has updated its procedures for cold weather and is hardening its infrastructure to prevent a repeat of the outage, which has raised concerns about the reliability of data centers and the potential for lease terminations.
The key outside markets today see the U.S. dollar index near steady. Crude oil prices are a bit weaker and trading around $59.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.14%.
Note: The gold market operates through two primary pricing mechanisms. The first is the spot market, which quotes prices for on-the-spot purchase and immediate delivery. The second is the futures market, which sets prices for delivery at a future date. Due to year-end positioning market liquidity, the December gold futures contract is currently the most actively traded on the CME.
Technically, February gold futures bulls’ next upside price objective is to produce a close above solid resistance at the contract/record high of $4,433.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,100.00. First resistance is seen at $4,285.00 and then at $4,300.00. First support is seen at the overnight low of $4,224.50 and then at $4,200.00. Wyckoff's Market Rating: 7.5.
March silver futures bulls have the strong overall near-term technical advantage. Their next upside price objective is closing prices above solid technical resistance at $60.00. The next downside price objective for the bears is closing prices below solid support at $55.00. First resistance is seen at the contract high of $59.90 and then at $60.00. Next support is seen at the overnight low of $57.77 and then at last week’s low of $56.85. Wyckoff's Market Rating: 9.0.
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