Post by : Meena Ariff

Gold markets opened Wednesday on a strong footing, with prices holding close to record territory as investors welcomed signs that U.S. inflation is cooling faster than expected. The softer data strengthened confidence that interest rate cuts may arrive sooner, boosting appetite for precious metals. Adding to the momentum, silver made history by crossing the $90 mark for the first time, reflecting growing demand in an uncertain global environment.

Spot gold advanced nearly 1% to trade at $4,627.95 per ounce by 0406 GMT, remaining just shy of the all-time high reached in the previous session. Gold futures in the United States for February delivery also posted solid gains, rising 0.8% to $4,635.60, as traders continued to build long positions amid improving sentiment across commodity markets.

The rally was driven largely by the latest U.S. inflation figures, which came in below forecasts and reinforced expectations that the Federal Reserve could shift toward a more accommodative policy stance. Lower borrowing costs tend to favor gold, as they reduce the relative appeal of interest-bearing assets and increase demand for safe stores of value.

Silver outperformed once again, surging beyond $90 an ounce in a landmark move. Market observers pointed to a combination of strong industrial consumption, increased safe-haven buying, and speculative interest as key drivers behind the sharp upswing. Expectations of prolonged monetary easing have further fueled investor enthusiasm for the metal.

Broader geopolitical concerns also supported precious metals, as ongoing conflicts and economic uncertainty encouraged investors to hedge risk through traditional safe-haven assets.

Analysts say gold and silver prices may continue to find support if inflation remains under control and policy easing stays on the horizon. Still, they caution that markets could face heightened volatility as investors react to upcoming economic indicators and guidance from major central banks worldwide.

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