Asian Stocks Climb as Fed Rate Cut Bets Fuel Metals Rally
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Asian stocks reached a six-week high on Monday while the dollar hovered near its lowest in almost three months, according to a new report from Reuters, published earlier today, December 29.
The report went on to say that the new situation comes as the industry awaits the Federal Reserve decision regarding interest rates early next year. The same expectations also led to a fierce rally in precious metals, the report added.
So far, silver climbed above the $80-per-ounce mark for the first time, before seeing a sharp decline in volatile trading on Monday. Meanwhile, platinum and palladium also saw a sharp dip after previously hitting all-time highs.
Even gold saw a sharp dip, erasing almost 1%, but has repeatedly breached record highs throughout 2025 on dollar weakness, while safe-haven demand skyrocketed and investors continue to wager on rate cuts.
Precious Metals Could Attract Long-Term Investors
The report cited Charu Chanana, chief investment strategist at Saxo, who commented on the matter, saying that precious metals have been lifted this year by a powerful mix of rate-cut tailwinds and hedging against geopolitical and fiscal uncertainty. “Add supply worries and the move has turned parabolic. But the late-year, near-vertical surge, especially in silver, also raises the risk of higher volatility. Near-term, the risk is technical and positioning-led.”
Chanana continued by saying that the big picture for precious metals still looks structurally supportive, with easier rates ahead, fiscal and geopolitical unease, and ongoing diversification demand. This suggests that any pullbacks could be seen as investment opportunities by long-term investors, who might use them to rebuild exposure.
Geopolitics was also back on investors’ minds following US President Donald Trump’s statement this Sunday that he and Ukrainian President Volodymyr Zelenskiy were getting a lot closer to an agreement to end the war in Ukraine.
Reuters then commented on the state of the stocks, saying that the MSCI’s broadest index of Asia-Pacific shares went up 0.27%, hitting the highest point since early October of this year. The report called it a strong start to the last week of the year, but it also noted that the index as a whole went up 25% in 2025, boosted by tech stocks as AI mania took hold of investors.
The report concluded by saying that investors’ focus on the holiday-curtailed week will be on the minutes of the Fed’s last meeting, which is expected to happen on Tuesday.
