Silver traded near a record high after US payrolls data reinforced speculation that the Federal Reserve will cut interest rates at its final policy meeting in 2025. Gold continued to rally.

US companies cut payrolls in November, the most since early 2023, according to ADP Research data released Wednesday, adding to concerns about a more pronounced weakening in the labor market.

Bond yields and the dollar weakened, helping silver recover from a 1.6% decline. Swap traders continue to expect a quarter-point rate cut at the Fed's December 9-10 meeting. Precious metals, including silver and gold, typically benefit from lower interest rates.

The white metal has surged recently, in part due to expectations that the US central bank will provide further monetary easing and that the new Fed chair will likely reflect President Donald Trump's views favoring lower interest rates.

Silver was also supported by a surge in speculative money betting on tight supply. Record volumes of the metal poured into London last month, putting pressure on other centers. Inventories at warehouses linked to the Shanghai Futures Exchange recently fell to their lowest level in a decade.

Holdings of silver-backed exchange-traded funds rose by about 200 tons on Tuesday, according to Bloomberg calculations, underscoring persistent investor interest in the metal. That brought total holdings to their highest level since 2022.

"Fast-money traders like a market where pullbacks remain shallow as the physical side continues to tighten with each dip," said Ahmad Assiri, a strategist at Pepperstone Group Ltd.

Silver fell to $58.32 an ounce at 10:12 a.m. in New York, after hitting an all-time high of $58.9789 an ounce the previous Wednesday.

Gold rose 0.2% to $4,213.98 an ounce, following a two-day decline. Palladium and platinum both weakened. The Bloomberg Dollar Spot Index fell 0.3%. (alg)

Source: Bloomberg