Rising expectations of a December rate cut reignited risk appetite this week (ended November 28), reversing the earlier selloff triggered by anxiety over stretched AI valuations.
The dollar spent most of the week below the 100 mark as a run of softer US economic data strengthened confidence that the Federal Reserve will move ahead with a 25 bps rate cut on December 10. Cooling retail sales, a modest uptick in producer inflation, accelerating private-sector job losses, and US consumer confidence falling to a seven-month low all reinforced the dovish tone already echoed by several Fed officials. According to CME data, markets are now pricing in nearly an 87 percent probability of a December cut. US equities rallied, with the three major indexes finishing the week up 3 percent to 5 percent, signaling a solid rebound in sentiment.
Precious metals rallied on the dovish shift, with silver stealing the spotlight after a remarkable 12 percent jump on the week, far outpacing gold’s solid 4 percent gain. Gold logged its fourth straight monthly rise, while silver notched its seventh consecutive monthly advance and its biggest monthly gain of 2025 at 18.7 percent. Chinese inventories at decade lows, supply tightness concerns, strong ETF inflows, and growing conviction in a December rate cut all helped drive COMEX silver to a record $57.2 per ounce.
On the daily chart, MCX Silver futures posted a strong rally on Friday, gaining 5.64 percent and decisively breaking above the previous two swing highs at Rs 1,65,818 per kg and Rs 1,70,415 per kg. Prices settled at a fresh all-time high of Rs 1,71,637. The bullish momentum is expected to persist in the coming week, though the price may encounter initial resistance near Rs 1,76,900, followed by Rs 1,84,100. On the downside, immediate support is seen around Rs 1,65,800, with the next support at Rs 1,62,000.
Base metals on the LME ended the week on strong footing, with copper leading the pack after rising more than 3 percent to trade near $11,180 a ton. Aluminium and zinc followed with gains of over 2 percent. Copper’s late-week rally brought prices back toward last month’s highs, supported by tightening global supply and improving macro sentiment. A string of mine disruptions, including halted output at Freeport-McMoRan’s Grasberg mine and slower-than-expected production recovery in Chile and Peru, prompted producers to sharply raise premiums, with Codelco even offering record contract prices to buyers in Asia and Europe.
Crude oil, by contrast, remained under pressure. WTI fell to a five-week low of $57.1 per barrel as optimism grew around a potential peace framework between Russia and Ukraine, which could eventually ease restrictions on Russian energy exports and add supply to global markets. Signals from both President Zelenskiy and President Putin that they are open to advancing US-backed draft proposals strengthened hopes of progress. Oil later recovered slightly to close near $58.5 per barrel, but still ended the week down about 4 percent, with traders now focused on the upcoming OPEC+ meeting, where the group is expected to maintain its pause on production increases into early 2026.
Oil prices are likely to remain volatile amid growing doubts over whether any agreement can be reached, following Russia’s launch of approximately 36 missiles and nearly 600 drones targeting locations across Ukraine over the weekend. This attack may also affect the US delegation’s upcoming visit to Moscow, including Special Envoy Steve Witkoff, to discuss the draft peace plan.
Looking ahead, markets are preparing for a busy calendar of data releases and speech by Fed Chair Powell. Final PMI readings from major economies, US ADP employment data for November, September’s PCE inflation report, and the University of Michigan’s sentiment and inflation expectations surveys are all due this week.
With the return of dovish rhetoric alongside reports that Kevin Hassett, known for favouring lower rates, is a leading candidate to replace Chair Powell, any additional softness in upcoming US data may solidify expectations of a rate cut. On the other hand, stronger-than-expected numbers could challenge prevailing expectations and prompt a recalibration of rate-cut bets.
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