Gold prices remained steady on Thursday after reaching a peak not observed in more than a week during the previous session, as market participants evaluated the possibility of an interest rate cut in December amid conflicting signals from the U.S. Federal Reserve. Spot gold held steady at $4,162.98 per ounce, as of 0047. Gold futures in the U.S. for December delivery saw a slight decrease of 0.1%, closing at $4,158.60 per ounce. The uncertainty surrounding the timing and extent of interest rate cuts has heightened hedging activities in swaptions and derivatives tied to overnight rates, as investors seek protection against rising policy ambiguity.

Certain Federal Reserve officials, including New York Fed President John Williams and Governor Christopher Waller, have suggested that a rate cut in December may be warranted, as softness in the labor market is putting downward pressure on Treasury yields and enhancing dovish expectations in futures markets. Their stance, however, differs from that of several regional Fed presidents who are calling for a halt in easing until inflation shows a clearer movement toward the 2% target. Meanwhile, Kevin Hassett, a prominent contender to take over from Jerome Powell as Fed Chair, has shared U.S. President Donald Trump’s view that interest rates should be reduced.

U.S. rate futures suggest an 85% likelihood of a rate cut happening in December, according to the sources. Gold, known for not generating interest, often shows robust performance in settings with low interest rates. Data released on Wednesday showed a decrease in the number of Americans filing new applications for unemployment benefits last week. Nonetheless, the job market still struggles to provide enough employment options for individuals who are out of work.

In November, U.S. consumer confidence showed a decrease, indicating increased worries among households about job opportunities and their financial circumstances. Elsewhere, spot silver held steady at $53.34 per ounce, platinum fell by 0.3% to $1,583.94, and palladium dropped by 0.4% to $1,417.56.