Precious Metals Market Update: 12/18/2025

Precious metals markets extended their winning streak on Thursday, December 18, 2025, fueled by a hotter-than-expected inflation report that validated the market’s growing concern over stagflation. Following the Federal Reserve’s rate cut on Wednesday, Thursday’s Consumer Price Index (CPI) release provided the perfect fundamental storm for safe-haven assets: loosening monetary policy colliding with stubborn price pressures. Gold led the charge, setting a new all-time nominal high, while silver consolidated its recent breakout gains.

The trading session was defined by volatility immediately following the morning data release. While the U.S. Dollar initially spiked on the inflation news, it quickly faded as traders remembered the Fed’s commitment—stated just yesterday—to prioritize labor market stability over strict inflation targets. This realization that the Fed may be "behind the curve" sparked aggressive buying in the yellow metal. Spot gold cleared the $4,355 resistance level that had capped prices earlier in the week, entering uncharted territory. Silver traded in a tight range but successfully defended the $66.00 handle, signaling strong demand from both industrial and investment sectors.

Key Drivers: The Stagflation Narrative Takes Hold

The Bureau of Labor Statistics reported that the Consumer Price Index (CPI) for November rose 0.4% month-over-month, exceeding the consensus forecast of 0.2%. On an annualized basis, inflation remains elevated at 3.8%. Normally, hot inflation might trigger fears of rate hikes. However, because the Federal Reserve explicitly cut rates yesterday to support a softening labor market, investors are now pricing in a scenario where inflation is allowed to run hot to prevent a recession. This dynamic lowers "real" interest rates (nominal rates minus inflation), which is historically one of the most potent drivers for non-yielding assets like gold bars. The data also impacted the Platinum Group Metals (PGMs). While platinum saw mild profit-taking after Wednesday’s explosive move, the fundamental outlook remains supportive as supply deficits continue to plague the market.

Technical Analysis: Price Discovery Mode

Technical momentum remains firmly bullish, though overbought conditions suggest intraday volatility may increase.

• Gold: By closing decisively above $4,355, gold has entered "price discovery" mode. In this phase, there are no historical resistance levels to reference. Fibonacci extensions suggest the next logical targets for bulls are $4,385 and eventually the psychological $4,400 barrier. Support has now moved up to the previous resistance band at $4,340.

• Silver: Silver’s price action on Thursday was a textbook "flagging" pattern. After the vertical surge on Wednesday, the metal traded sideways, allowing moving averages to catch up. As long as prices remain above the breakout zone of $64.50, the technical bias suggests a potential test of $68.00. Investors looking to add silver coins to their portfolios should view dips toward $65.00 as constructive retests of the support level.

Forward-Looking Commentary:

As the trading week draws to a close, liquidity is expected to thin out ahead of the upcoming holiday season.

• Friday’s Close: The weekly closing price tomorrow will be significant. If gold can sustain these gains into the weekend, it would mark its highest weekly close on record, likely attracting further attention from momentum funds and institutional allocators next week.

• Geopolitical Hedges: With the economic data largely digested, attention may briefly pivot back to geopolitical tensions in Eastern Europe, which have simmered in the background. Any escalation over the weekend typically prompts Monday morning gaps in palladium and gold prices.

For now, the macro environment—defined by falling rates and sticky inflation—continues to provide a robust tailwind for the precious metals complex.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Market data and prices are subject to change.