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Below the Quote on the Fed rate cut from Anindya Banerjee , Kotak Securities

The US Federal Reserve has lowered rates by 50 basis points, a move that was largely anticipated. This marks only the third time in history that the Fed has initiated a rate-cutting cycle with a 50 bps reduction, the previous instances being in 2001 and 2007. However, unlike those past events, this cut comes at a time when the economy is still performing well.

The Fed has provided guidance suggesting that rates could drop by 200 basis points over the next two years. However, market expectations diverge, with traders anticipating rates to climb to between 3% and 5% by December 2025. Such differences in rate forecasts are typical at the beginning of a rate-cutting cycle.

We anticipate that both gold and silver will benefit from this easing of monetary policy, aside from short-term volatility, as the US dollar weakens and the yield curve steepens. Gold prices could range between $2,530 and $2,630 per ounce, while silver may trade within a band of $30 to $32 per ounce.

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