Gold now gives away some gains and disputes the key $4,300 zone per troy ounce following earlier multi-week highs. The move is being driven by expectations that the Fed will deliver further rate cuts next year, with the yellow metal climbing despite a firmer Greenback and rising US Treasury yields across the board.
United States CFTC Gold NC Net Positions: $2103K vs $202.3K
Gold now gives away some gains and disputes the key $4,300 zone per troy ounce following earlier multi-week highs. The move is being driven by expectations that the Fed will deliver further rate cuts next year, with the yellow metal climbing despite a firmer Greenback and rising US Treasury yields across the board.
United Kingdom CFTC GBP NC Net Positions dipped from previous £-55K to £-793K
Gold now gives away some gains and disputes the key $4,300 zone per troy ounce following earlier multi-week highs. The move is being driven by expectations that the Fed will deliver further rate cuts next year, with the yellow metal climbing despite a firmer Greenback and rising US Treasury yields across the board.
Trump eyes Warsh and Hassett as top contenders to replace Powell in 2026 – WSJ
In an interview with the Wall Street Journal, the US President Donald Trump revealed that he is leaning on former Fed Governor Kevin Warsh and also on the National Economic Council Director Kevin Hassett to lead the Federal Reserve since May 2026.
When asked if Kevin Warsh was at the top of the list Trump said “Yes, I think he is. I think you have Kevin and Kevin. They’re both—I think the two Kevins are great,” he said. “I think there are a couple of other people that are great.”
The article mentioned that Warsh was grilled over a 45 minute meeting on Wednesday at the White House in which Trump pressed Warsh on whether he could trust him to support lower interest rates.
Trump said that he though the next Fed Chair should consult with him on where to set interest rates.
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates.
When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money.
When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions.
The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system.
It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
Silver Price Analysis: Drops after hitting all-time high, retracement risk looms
Silver prices plunges after hitting an all-time high (ATH) of $64.65 losses 2.75% as investors book profits ahead of the weekend, as Federal Reserve officials remain divided about future monetary policy meetings. At the time of writing, XAG/USD trades at $61.84.
XAG/USD Price Forecast: Technical outlook
The grey metal remains upward biased but in the short-term could be headed for a retracement. Price action shows the formation of a ‘bearish engulfing’ candle chart pattern, an indication that sellers outweigh buyers. Nevertheless, there are signs of a potential negative divergence as the Relative Strength Index (RSI) it reaches a lower peak while the non-yielding metal registers a higher high. Therefore, further downside looms.
Silver’s first support s $61.00. A breach of the latter will expose the December 10 daily low of $60.09, $60.00 ahead of challenging December’s 5 high turned support at $59.33.
Conversely, if XAG/USD rises past $62.00, expect another leg-up with the next resistance levels being the December 11 peak of $64.30 ahead of the record high of $64.65.
XAG/USD Price Chart – Daily
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold’s. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold’s moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
US Dollar Weekly Forecast: Sell-off done?
The week that was
The Greenback retreated for the third consecutive week and remains well on track to end its second straight month of losses.
That said, the US Dollar Index (DXY) remained well on the defensive, approaching the key 98.00 contention zone to hit new two-month troughs. It also extended its recent breach below the critical 200-day SMA around 99.30, which could lead to further weakness in the short term.
The Greenback’s deeper retracement, however, came in contrast to the decent recovery in US Treasury yields across various maturity periods, as investors continued to digest the Federal Reserve’s (Fed) widely expected decision to lower its Fed Funds Target Range by 25 basis points to 3.50%-3.75%.
A Fed that cut because it had to, not because it wanted to
This meeting left the impression of a Fed that moved with a degree of reluctance. The rate cut wasn’t about victory over inflation; it was about acknowledging that the labour market is losing momentum and that the risks of waiting too long are starting to outweigh the risks of moving a little early.
Inflation, by the Fed’s own standards, still isn’t quite where it should be. But officials appear increasingly comfortable with the idea that the remaining stickiness is driven by temporary factors, tariffs chief among them, rather than by an overheating economy. That distinction matters, as it provides policymakers with a buffer to pause, monitor, and refrain from overreacting to data that may eventually fade.
Inside the Fed, there’s still clear disagreement over how quickly policy should be eased from here. Some prefer to proceed cautiously, reducing rates only when the data demands it, while others prioritise the increasing indications of stress in the job market. What unites them, though, is the sense that the tightening cycle is over. Rate hikes are no longer part of the conversation.
With policy now sitting close to the upper end of what officials consider neutral, the Fed has shifted into a familiar posture: wait and see. From here, every decision is likely to be framed as risk management, balancing incomplete progress on inflation against a labour market that’s cooling faster than many expected. For now, the message is clear enough: easing has begun, but it will be cautious, uneven, and entirely data-driven.
Fed dissenters strike a cautious tone
While the Fed moved ahead with an interest rate cut this week, not everyone around the table was convinced the time was right. Several officials who voted against the decision made clear on Friday that, in their view, inflation remains too sticky and the data too thin to justify lower borrowing costs just yet.
Inflation worries still front and centre
Chicago Fed President Austan Goolsbee explained that his dissent reflected a preference for patience. He said he would have waited for additional inflation and labour market data before easing policy, particularly given how sensitive businesses and households still are to rising prices.
Goolsbee argued that delaying a cut until early next year would have allowed policymakers to assess a fresh batch of official data, with several key reports due as soon as next week. In his assessment, that approach would have carried little risk to employment, noting that the job market appears to be cooling, but only at a moderate pace.
A similar line came from Kansas City Fed President Jeffrey Schmid, who said he opposed the cut because inflation remains “too hot”. He argued that monetary policy should stay modestly restrictive to ensure price pressures continue to ease. From his perspective, the economy is still showing momentum, and inflation dynamics suggest policy is not yet tight enough. He added that little has changed since he dissented from the October rate cut, pointing out that inflation is still above target while the labour market remains broadly balanced.
Labour market risks seen differently
Not all those who dissented were solely concerned with inflation. Philadelphia Fed President Anna Paulson struck a slightly different note, saying she remains more concerned about potential weaknesses in the labour market than about upside inflation risks.
Speaking at an event in Wilmington, Paulson said she sees a reasonable chance that inflation will continue to fall over the course of next year. She linked that view to the fading impact of tariffs, which she described as a key factor behind inflation overshooting the Fed’s target this year. That expected easing, she suggested, gives policymakers some room to focus more closely on employment risks.
Preference for tighter policy still evident
Cleveland Fed President Beth Hammack, however, made it clear she would prefer policy to lean more firmly against inflation. She said the current policy rate is sitting close to neutral and argued that a slightly more restrictive stance would help apply additional pressure on prices.
Taken together, the comments underline how finely balanced the debate within the Fed remains. While the majority opted to begin easing, the dissenting voices suggest confidence in inflation is far from complete, a reminder that the path ahead for US rates is likely to remain uneven and highly data-dependent.
Technical picture
After briefly breaking above the 100.00 handle in November, the US Dollar Index (DXY) has slipped into a corrective phase and, so far, has struggled to regain its footing.
For the broader outlook to turn decisively bullish again, the index would first need to reclaim the 200-day SMA at 99.34. Beyond that, attention would shift to the November peak at 100.39 (November 21), followed by the weekly high at 100.54 (May 29) and the May cap at 101.97 (May 12).
On the downside, initial support is seen at the December base at 98.13 (December 11). A sustained break below that level would likely open the door to a move towards the weekly trough at 98.03 (October 17), with further weakness potentially dragging the index down to the 2025 bottom at 96.22 (September 17). Below there, the focus would turn to the February 2022 valley at 95.13 (February 4) and, ultimately, the 2022 floor at 94.62 (January 14).
Momentum indicators continue to point to downside risks. The Relative Strength Index (RSI) is hovering around the 35 area, while the Average Directional Index (ADX), now above 20, suggests the current trend is starting to gather strength.
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Bottom line: uncertainty still calls the shots
The US Dollar has clearly lost some of its lustre. Momentum has faded, confidence is shaky, and the Fed has done little to give traders the clear roadmap they’re looking for. However, the situation is not static. A handful of officials are still flying the hawkish flag, and that’s enough to give the Greenback some short-term support when positioning gets stretched.
The bigger complication is the lingering fallout from the historic government shutdown. On the surface, the US economy still looks reasonably healthy, but without up-to-date data, that picture is incomplete at best. Until those delayed releases finally land, policymakers and markets alike are effectively flying blind, and when they do arrive, they could quickly reshape expectations for the Fed’s next move.
For now, inflation remains the main event, with the labour market playing a crucial supporting role. If price pressures turn out to be stickier than hoped, the Fed may be forced to lean back towards restraint. Should that happen, the Dollar could yet find a path to redemption, but until then, uncertainty remains firmly in charge.
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates.
When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money.
When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions.
The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system.
It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
Cheaper European Gas diverts Qatari LNG toward India – Commerzbank
Lower European Gas prices (TTF) are having an impact: according to an analysis of ship tracking data by Bloomberg, LNG shipments from Qatar have recently been diverted away from Europe to India, Commerzbank’s Head of FX and Commodity Research Thu Lan Nguyen notes.
U.S. supply risks loom as winter Gas demand uncertain
“Overall, European LNG imports between December 1 and 9 fell compared to the same period in November. The fact that Gas storage levels in the EU have not declined more rapidly so far is likely due to the recent mild temperatures. However, if heating demand rises and LNG imports continue to weaken at the same time, storage withdrawals could reach a critical level.”
“There are also risks with regard to supply: in particular, supply from the US could be less generous than previously thought. This could be the case, for example, if domestic demand turns out to be higher than assumed so far. The EIA, for example, expects US Gas prices to rise this winter due to an impending cold spell.”
“Recently, however, prices have fallen again as temperatures have been milder in mid-December. In the medium term, increasing electricity consumption by data centers could also significantly increase Gas demand. This was one of the reasons why the IEA raised its forecasts for US electricity consumption at the beginning of this year.”
USD/INR holds onto US-India trade uncertainty-led gains, India’s CPI rises 0.7%
The Indian Rupee (INR) extends its decline against the US Dollar (USD) on Friday, with the USD/INR pair hitting fresh all-time highs at 90.86. The Indian currency continues to underperform its peers as investors remain anxious over whether the United States (US) and India will reach a trade deal in the near term.
No major outcome has come out of the two-day meeting between Deputy US Trade Representative Rick Switzer and his team, and top negotiators from India, keeping uncertainty over the US-India trade deal intact.
A slight optimism built on the US-India trade pact outlook on Wednesday when US Trade Representative Jamieson Greer stated, while testifying before the Senate Appropriations Committee, that the latest offer by New Delhi is the “best ever” the US has seen, while keeping the claim that India is a “tough nut to crack”. However, sentiment over the Indian Rupee is expected to remain bogged down unless a deal is announced.
On comments by US Trade Representative Greer, Commerce and Industry Minister Piyush Goyal stated on Thursday that Washington should sign the bilateral deal if it is very happy with the offer. “His happiness is very much welcome. And, I do believe that if they are very happy, they should be signing on the dotted lines,” Goyal said, PTI reported.
It seems that the Indian equity market will continue to witness outflows from overseas investors unless a trade deal between the US and India is announced. Foreign Institutional Investors (FIIs) have remained net sellers so far in all trading days of December, and have offloaded stake worth Rs. 18,491.29 crore.
On the domestic front, India’s retail Consumer Price Index (CPI) data for November has come almost in line with expectations. Inflation at the retail level has come in at 0.7%, up from 0.25% in October.
The table below shows the percentage change of Indian Rupee (INR) against listed major currencies this week. Indian Rupee was the weakest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | INR | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.77% | -0.39% | 0.28% | -0.47% | -0.46% | 0.47% | -1.11% | |
| EUR | 0.77% | 0.42% | 1.10% | 0.34% | 0.37% | 1.44% | -0.30% | |
| GBP | 0.39% | -0.42% | 0.71% | -0.08% | -0.05% | 0.85% | -0.71% | |
| JPY | -0.28% | -1.10% | -0.71% | -0.74% | -0.73% | 0.23% | -1.37% | |
| CAD | 0.47% | -0.34% | 0.08% | 0.74% | 0.03% | 0.92% | -0.63% | |
| AUD | 0.46% | -0.37% | 0.05% | 0.73% | -0.03% | 0.90% | -0.66% | |
| INR | -0.47% | -1.44% | -0.85% | -0.23% | -0.92% | -0.90% | -1.74% | |
| CHF | 1.11% | 0.30% | 0.71% | 1.37% | 0.63% | 0.66% | 1.74% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Indian Rupee from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent INR (base)/USD (quote).
Daily digest market movers: US Dollar underperforms on dovish Fed bets
- The Indian Rupee underperforms the US Dollar even as the latter is expected to close in red for the third straight week. At the time of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, strives to regain ground after posting a fresh seven-week low of 98.13 on Thursday.
- The US Dollar has been under pressure since Wednesday when the Federal Reserve (Fed) ruled out the possibility of a pause in the ongoing monetary-easing campaign despite inflationary pressures remaining well above the 2% target.
- The Fed’s dot plot showed that policymakers collectively see the Federal Fund Rate heading to 3.4% by the end of 2026, signaling that there will be one interest rate cut next year. However, Fed Chair Jerome Powell clarified that the bar of another interest rate cut is very high, and we are close to the upper range of neutrality, a level that neither stimulates nor restricts the economy.
- Before the monetary policy announcement, market participants anticipated the Fed to signal that it is done with trimming interest rates, following a 25-basis-point (bps) reduction to 3.50%-3.75%.
- Going forward, investors will pay close attention to the US Nonfarm Payrolls (NFP) data for fresh cues on the interest rate outlook. The impact of the official employment data will be significant on market expectations for the Fed’s monetary policy outlook, as the central bank has reduced borrowing rates in its last three meetings due to downside labor market risks.
Technical Analysis: USD/INR holds key 20-day EMA
In the daily chart, USD/INR trades at 90.6885. The 20-day Exponential Moving Average (EMA) at 89.8183 rises and stays beneath the spot price, keeping the short-term uptrend intact and supporting dip-buying interest.
Price action remains above the moving average, suggesting the advance is being tracked by trend followers.
The 14-day Relative Strength Index (RSI) at 69.27 edges toward overbought, confirming firm bullish momentum while hinting at risk of fatigue on further gains.
The bias stays firm as long as USD/INR holds above the rising 20-day EMA, with pullbacks expected to be absorbed near the average. A decisive break above the fresh all-time high of 90.86 could lead to further advancement towards 92.00.
RSI hovering just below 70 signals strong but stretched momentum; a push above 70 could trigger consolidation, while sustained readings below that threshold would maintain an orderly grind higher. A daily close back under the 20-day EMA would soften the tone and open room for a deeper retracement towards the December 1 low at 89.51.
(The technical analysis of this story was written with the help of an AI tool)
Indian economy FAQs
Meme Coins Price Prediction: DOGE, SHIB, PEPE stall amid warming retail demand
Meme coins, including Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe (PEPE), struggle to regain strength as the broader cryptocurrency market recovers. Derivatives data reveals fresh retail demand as Open Interest of DOGE, SHIB, and PEPE futures surge. Still, Dogecoin and Pepe are stuck in a consolidation range while Shiba Inu struggles to break a long-standing resistance trendline.
Retail rekindles interest in major meme coins
CoinGlass data shows that the DOGE, SHIB, and PEPE futures Open Interest (OI) – notional value of both long and short positions – has increased by 4%, 8%, and 3% to $1.48 billion, $84.82 million, and $253.52 million, respectively. This indicates that the retail interest in meme coins is increasing.
DOGE recorded $2.56 million in long liquidations in the last 24 hours, outpacing $661,510 in short liquidations, suggesting a bearish tilt. However, the short liquidations in SHIB and PEPE during the same time period outpace the long liquidations, indicating a bullish bias.
Dogecoin risks falling out of a consolidation range
Dogecoin trades near $0.1400 at press time on Friday, holding steady after a 2% drop the previous day. The meme coin trades within a consolidation range, extending from the November 21 low at $0.1332 to the November 26 high at $0.1568.
A decisive close above $0.1568 would confirm the bullish breakout, which could extend the rally to the $0.1810 zone.
The Relative Strength Index (RSI) on the daily chart is at 41, steadily rising toward the midpoint, suggesting a decline in selling pressure. Similarly, the Moving Average Convergence Divergence (MACD) rises toward the zero line, suggesting an underlying increase in bullish momentum.
If DOGE slips below $0.1332, it could risk a steeper correction to the $0.1000 psychological support.
Shiba Inu rebounds from local support trendline, boosting breakout chances
Shiba Inu edges lower by nearly 1% at the time of writing on Friday, marking its third straight day in the red. However, the rebound from $0.00000817 (Thursday’s low) at the support trendline connecting the November 21 and December 1 lows indicates underlying demand for SHIB.
If SHIB slips below $0.00000817, it would nullify the support trendline, potentially extending the decline to the November 21 low at $0.00000755.
The RSI on the daily chart is at 46, extending a lateral move, which indicates a lack of momentum at neutral levels. Meanwhile, the MACD and signal line struggle to stretch the uptrend toward the zero line as bullish momentum wanes.
To reinstate an uptrend, SHIB should surpass the overhead trendline connecting the highs of September 13 and October 6 at $0.00000900. A potential breakout rally could push SHIB prices to the $0.00001000 psychological level.
Pepe’s downcycle in a range risks testing crucial support
Pepe holds steady within a consolidation range, stretching from the lows of November 4 and November 21 at $0.00000521 and $0.00000395, respectively. The meme coin is in a downcycle, risking a revisit to the $0.00000395 level.
Similar to SHIB, the RSI at 45 hovers in the neutral zone while MACD and signal line inch closer toward the positive territory.
Looking up, a potential rebound in PEPE above $0.00000521, confirming a bullish breakout of the range, could test the $0.00000650 supply zone.
PBOC sets USD/CNY reference rate at 7.0638 vs. 7.0686 previous
On Friday, the People’s Bank of China (PBOC) sets the USD/CNY central rate for the trading session ahead at 7.0638 compared to the previous day’s fix of 7.0686.
PBOC FAQs
The primary monetary policy objectives of the People’s Bank of China (PBoC) are to safeguard price stability, including exchange rate stability, and promote economic growth. China’s central bank also aims to implement financial reforms, such as opening and developing the financial market.
The PBoC is owned by the state of the People’s Republic of China (PRC), so it is not considered an autonomous institution. The Chinese Communist Party (CCP) Committee Secretary, nominated by the Chairman of the State Council, has a key influence on the PBoC’s management and direction, not the governor. However, Mr. Pan Gongsheng currently holds both of these posts.
Unlike the Western economies, the PBoC uses a broader set of monetary policy instruments to achieve its objectives. The primary tools include a seven-day Reverse Repo Rate (RRR), Medium-term Lending Facility (MLF), foreign exchange interventions and Reserve Requirement Ratio (RRR). However, The Loan Prime Rate (LPR) is China’s benchmark interest rate. Changes to the LPR directly influence the rates that need to be paid in the market for loans and mortgages and the interest paid on savings. By changing the LPR, China’s central bank can also influence the exchange rates of the Chinese Renminbi.
Yes, China has 19 private banks – a small fraction of the financial system. The largest private banks are digital lenders WeBank and MYbank, which are backed by tech giants Tencent and Ant Group, per The Straits Times. In 2014, China allowed domestic lenders fully capitalized by private funds to operate in the state-dominated financial sector.