On December 2, 2025, gold prices declined amid climbing U.S. Treasury yields, prompting cautious investor sentiment ahead of the Federal Reserve’s upcoming policy announcement. Silver futures fell from their recent all-time highs, reflecting subdued momentum across precious and industrial metals as markets await critical economic data and potential shifts in monetary policy.

Gold Retreats as Treasury Yields Rise

At 09:10 ET (14:10 GMT), spot gold slipped 0.4% to $4,215.70 per ounce after hitting a six-week peak the day before. U.S. gold futures closed down 0.7% at $4,247.40 per ounce. The benchmark 10-year Treasury yield approached a two-week high, diminishing demand for the non-yielding metal and tempering enthusiasm for anticipated near-term Federal Reserve rate cuts.

Despite the temporary pullback, market consensus remains tilted toward an interest-rate reduction anticipated next week. Investors expect that easing inflation pressures and weaker labour market data will provide the Federal Reserve flexibility to lower borrowing costs. Typically, such rate cuts enhance gold’s appeal by lowering the opportunity cost of holding safe-haven assets.

Nevertheless, traders remained cautious about taking aggressive positions ahead of significant scheduled economic reports. The November ADP private-sector employment numbers and the delayed September Personal Consumption Expenditures (PCE) Price Index—the Fed’s preferred inflation indicator—are both due this week. These releases could substantially influence the timing and magnitude of monetary policy easing.

Silver and Metals Market Pullback

Precious metals broadly showed caution on Tuesday. Silver futures declined 1.4% to $58.345 per ounce, retreating from Monday’s record high of $59.44. Platinum futures also slipped 2.2% to $1,648.25 per ounce, reflecting positioning ahead of the Fed’s announcement.

Industrial metals followed the wider subdued trend. Copper futures on the London Metal Exchange dropped 0.4% to $11,219.15 per ton, while U.S. copper futures declined 0.3% to $5.2875 per pound. These moves highlight investor wariness as they brace for policy signals and economic releases.

UBS Analyst Outlook on Gold Through 2026

UBS analysts maintain a positive medium-term outlook for gold, expecting support to persist into 2026. Their research emphasizes resilient official sector demand, ongoing global macroeconomic uncertainties, and further de-dollarisation as key factors underpinning the metal’s strength.

Led by Daniel Major, the UBS team stresses that gold entered 2025 as a “consensus long” asset and continues to maintain that status into next year. Though the gold rally occasionally exhibited crowded momentum trade characteristics, traditional indicators such as Comex futures positioning and ETF flows have not reached extreme bullish levels. Instead, the rally is attributed to widespread buying from both private investors and official entities, marking a structural demand shift.

Political developments add complexity to market dynamics. U.S. President Donald Trump revealed he has selected a nominee to succeed Federal Reserve Chair Jerome Powell but withheld the name. Reports have speculated that White House economic adviser Kevin Hassett is among the potential candidates, introducing uncertainty that investors must consider as they position ahead of the Fed decision.

Precious Metals and Market Implications

Gold prices have softened to around $4,215 per ounce as investors weigh the impact of rising Treasury yields and upcoming economic data. Silver’s retreat from record highs reflects a broader market pause, indicating that traders remain cautious in light of policy uncertainty. UBS’s forecast of sustained gold demand through 2026 highlights the metal’s ongoing role as a safe haven amid economic and geopolitical crosscurrents.

With major reports like the ADP employment data and September’s PCE index forthcoming, precious metals such as silver and gold will remain closely watched by investors seeking protection against volatility triggered by Federal Reserve actions.