Gold holds near two-week highs as dovish Fed bets build

LONDON (November 26) Gold (XAU/USD) edges higher on Wednesday as traders lean into a more dovish Federal Reserve (Fed) outlook, with XAU/USD trading around $4,171, near two-week highs after closing almost unchanged on Tuesday.

Traders grew more confident in a softer monetary policy path after reports that White House Senior Adviser Kevin Hassett has emerged as the leading candidate to become the next Fed Chair. Hassett’s rise to the top of the shortlist is being viewed as a dovish signal, especially since he has previously advocated for interest rate cuts.

Furthermore, delayed US economic data released on Tuesday showed weaker consumer spending and a moderation in producer prices, leading markets to bolster expectations of a December rate cut.

Lower interest rates generally bode well for the non-interest-bearing precious metal. However, Gold could face headwinds from reduced safe-haven demand after positive headlines suggested signs of progress in Russia-Ukraine peace talks.

Market movers: Peace-talk headlines lift risk mood as DXY lingers near lows

• The US Dollar Index (DXY), which tracks the Greenback against a basket of six major currencies, is hovering around 99.84 after slipping to a fresh weekly low of 99.60 earlier in the day.
• Early signs of progress in US-brokered Russia-Ukraine peace talks supported risk sentiment after an ABC News report cited a US official saying Ukraine had agreed with the US on the terms of a possible peace deal during talks in Abu Dhabi. However, the Kremlin said on Wednesday that it is premature to talk about reaching a peace agreement, according to Interfax.
• Deutsche Bank raised its 2026 Gold forecast to $4,450 from $4,000 on Wednesday, citing stronger central-bank buying and growing investor interest. The bank now expects a possible high near $4,950, which would be about 14% above current December 2026 futures.
• According to the World Gold Council report published on 25 November, global Gold ETF holdings saw a net inflow of 55.1 tonnes in October 2025, driven by strong additions in North America (47.2 tonnes) and Asia (44.8 tonnes), while Europe recorded notable outflows of 37.3 tonnes.
• The US calendar features second-tier releases on Wednesday, including September Durable Goods Orders, weekly Initial Jobless Claims, and the Fed’s Beige Book

FXStreet