Gold fell slightly in price on Wednesday, as investors prepared to analyze the forecast of US Federal Reserve Chairman Jerome Powell on a day when an interest rate cut is expected, while silver continued its record growth above $60 an ounce, UNN reports with reference to Reuters.
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Spot gold prices fell 0.1% to $4205.4 an ounce as of 07:12 GMT (09:12 Kyiv time). US gold futures for February delivery fell 0.1% to $4233.30 an ounce.
Spot silver prices rose 1.1% to $61.34 an ounce after reaching an all-time high of $61.61 earlier in the session. It strengthened its Tuesday breakthrough above the $60 an ounce threshold.
Silver is now catching up with gold in terms of value, thanks to its widespread industrial use amid a supply crisis, while demand for the precious metal has soared this year, the publication writes.
In October, it took 82 ounces of silver to buy one ounce of gold. Today it's about 69, said Jigar Trivedi, a senior analyst at Reliance Securities, based in Mumbai.
"Silver is also in demand due to fundamental factors," Trivedi said.
Sectors such as solar energy, electric vehicles and their infrastructure, as well as data centers and artificial intelligence, will drive industrial demand growth until 2030, according to a research report by the industry association Silver Institute published on Tuesday.
Maria Smirnova, Chief Investment Officer at Sprott Asset Management, said the metal received additional support from inflows into exchange-traded funds and the US decision to recognize it as a critical mineral earlier this year.
Global silver reserves continue to decline, and expectations of a Fed rate cut have supported demand.
Meanwhile, a two-day Fed meeting is expected. Investors see about an 89% chance of a 25 basis point rate cut by the US central bank.
In the long term, gold remains on an upward trajectory and maintains a bullish bias, but in the short term, prices remain in a range as investors await clarity on the Fed's next steps and future policy direction, said GoldSilver Central Managing Director Brian Lan.
White House economic adviser Kevin Hassett, a leading contender for the next Fed chairman, said on Tuesday that there was "plenty of room" for further cuts, but rising inflation could change that outlook.
Lower interest rates generally favor non-yielding assets such as gold.
Platinum, meanwhile, lost 1.3% to $1667.71, while palladium fell 1% to $1492.25.