Market Analysis Federal Reserve official Williams stated that monetary policy is well-prepared for 2026, projecting the U.S. unemployment rate to drop to 4.5% by late 2025. Labor market risks have risen while inflation risks have eased, with Fed policy shifting from mild tightening to neutrality. Inflation is expected to rise to 2.5% in 2026 before declining to 2% in 2027. The Fed plans to actively use standing repo facilities for liquidity management. Governor Milan reiterated that current policy unnecessarily restricts the economy, noting that "underlying" inflation—excluding "phantom inflation"—is nearing the Fed’s target.
Geopolitically, leaders from Germany, France, the UK, Italy, Poland, Finland, Norway, Sweden, the Netherlands, and EU institutions issued a joint statement announcing a "multinational force" to support Ukraine. The force will assist in rebuilding Ukraine’s armed forces, securing its airspace, enhancing maritime security, and conducting military operations within Ukraine.
Futures Market & Volume On Dec 15, 2025, SHFE gold’s main contract opened at 980.62 yuan/gram and closed at 983.16 yuan/gram, up 1.29% from the previous close. Daily volume stood at 41,087 lots, with open interest at 129,725 lots. Overnight, the contract opened at 983.34 yuan/gram and closed at 975.52 yuan/gram, down 0.78% from the afternoon session.
SHFE silver’s main contract opened at 14,974 yuan/kg and closed at 14,793 yuan/kg, down 0.66% from the prior close. Daily volume reached 2,357,226 lots, with open interest at 381,828 lots. Overnight, it opened at 14,944 yuan/kg and closed at 14,815 yuan/kg, up 0.15% from the afternoon session.
U.S. Treasury Yields & Spreads The 10-year U.S. Treasury yield closed at 4.168% on Dec 15, down 0.59 bps, with the 10Y-2Y spread widening to 0.679% (+0.45 bps).
SHFE Gold-Silver Positions & Volume For the Au2602 contract, long positions rose by 4,924 lots while shorts fell by 2,002 lots. Gold’s total volume surged 20.20% to 574,372 lots. For Ag2602, longs dropped by 22,084 lots and shorts by 10,019 lots. Silver’s total volume increased 7.11% to 3,946,097 lots.
ETF Holdings Gold ETF holdings remained flat at 1,053.12 tons, while silver ETFs added 20 tons to 16,103 tons.
Arbitrage Tracking Domestic premiums: Gold’s discount widened to -10.84 yuan/gram; silver’s to -894.90 yuan/kg. The gold-silver ratio on SHFE was 66.46 (-1.42%), while the global ratio stood at 66.96 (-1.28%).
Fundamentals On Dec 15, SGE gold trading volume jumped 51.92% to 77,786 kg, while silver volume fell 23.80% to 919,052 kg. Gold deliveries totaled 11,872 kg; silver, 3,210 kg.
Strategy Gold: Cautiously Bullish The December FOMC meeting delivered unexpectedly dovish signals, and prolonged Russia-Ukraine tensions suggest gold may trade range-bound with upward bias. Au2602 is expected to fluctuate between 940–990 yuan/gram.
Silver: Neutral Silver outperforms gold slightly, with the ratio likely to narrow further. However, post-rally consolidation is expected; watch for profit-taking risks. Ag2602 may range between 14,500–15,500 yuan/kg.
Arbitrage: Buy gold-silver ratio dips. Options: Pause.
Risks Overseas liquidity risks. Speculative positions unwinding.
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