Palladium prices slipped on Tuesday despite a weaker dollar and growing expectations that the Federal Reserve will cut interest rates at next month’s meeting.

UBS raised its palladium price forecasts by 50 dollars an ounce across all time horizons, citing expectations that the market will remain in a slight supply deficit through next year.

The bank noted that options-market sentiment toward palladium remains mildly positive, though it has drifted closer to neutral compared with the beginning of the year.

The implied-volatility skew between one- to six-month calls and puts currently stands between 1.8% and 2.4%, down from peaks of 3.4% to 9.1% earlier in the year.

UBS added that the earlier surge in optimism—from early November 2024 through late January 2025—was driven largely by concerns over potential new sanctions targeting Russian palladium exports.

Russia accounts for roughly 40% of global mined supply, but with Russian metal continuing to flow into international markets, worries over supply disruptions have eased.

Near-term price volatility will depend heavily on the outcome of the US Commerce Department’s Section 232 investigation into critical minerals, as well as an anti-dumping petition filed by miner Sibanye and the United Steelworkers union. Market participants are awaiting the administration’s decision on whether to impose tariffs on palladium imports.

Despite lifting its price target, UBS said it sees stronger upside potential in other precious metals than in palladium, even as the palladium market is expected to remain in a slight deficit through 2026.

Meanwhile, the US Dollar Index fell 0.4% to 99.7 points by 15:42 GMT, after trading between 100.2 and 99.7.

In futures trading, palladium for December delivery slipped 0.8% to 1,393.5 dollars an ounce at 15:43 GMT.

Bitcoin rose on Tuesday, extending its rebound from recent losses as expectations for a potential Fed rate cut in December strengthened, helping lift risk-sensitive assets.

Still, the rally appeared to be losing momentum, with investors remaining highly cautious toward the crypto market after the steep declines seen through October and early November.

Altcoins posted stronger gains on Tuesday but are also recovering from sharp losses over the past month.

Bitcoin rose 0.8% to 88,187.9 dollars by 12:43 a.m. ET (05:43 GMT).

Bitcoin benefits from renewed December-cut bets

The rebound from a seven-month low was driven mainly by a revival in expectations that the Federal Reserve could cut rates in December. At least two Fed officials signaled support for such a move, helping shift market pricing.

Futures markets now assign a 77.2% probability to a 25-basis-point cut at the December 9–10 meeting, up from just 41.8% a week earlier, according to CME’s FedWatch tool.

The shift ignited a broad rally across risk assets, and cryptocurrencies joined the rebound, though their gains lagged the sharp recovery in equities—particularly tech stocks. While crypto often trades in tandem with tech, it has begun decoupling from that correlation since early October.

Crypto prices have been in an extended downtrend since last month, pressured by several factors. Retail traders remained wary after October’s flash crash, while institutional inflows shrank noticeably, with US-listed Bitcoin ETFs seeing five straight weeks of outflows.

Markets now look ahead to a series of upcoming US economic releases for clues before the December Fed meeting. Producer-price inflation and September retail sales are due later on Tuesday, while the Fed’s preferred inflation gauge, the core PCE index, arrives Thursday.

Crypto prices today: Altcoins lead the rebound

Broader crypto assets performed slightly better than Bitcoin on Tuesday, with selective bargain-hunting among beaten-down names.

Ether climbed 3.2% to 2,928.08 dollars, while Ripple (XRP) jumped 8.7% to 2.2523 dollars.

Oil prices fell on Tuesday as concerns about abundant supply outweighed worries over continued sanctions on Russian shipments, while peace talks aimed at ending the war in Ukraine showed no progress.

Brent crude dropped 33 cents, or 0.5%, to 63.04 dollars a barrel by 11:46 GMT. US West Texas Intermediate declined 32 cents, or 0.5%, to 58.52 dollars.

Both benchmarks had gained 1.3% on Monday, after growing doubts about reaching a peace agreement between Russia and Ukraine boosted expectations that constrained flows of sanctioned Russian crude and fuel would persist.

Despite market anxiety over Russian shipments, broader 2026 supply–demand projections point to a more oversupplied market, with multiple forecasts suggesting supply growth will outpace demand next year.

Priyanka Sachdeva, senior market analyst at Phillip Nova, said in a Tuesday note: “In the near term, the main risk lies in oversupply, and current price levels appear vulnerable to pressure.”

Amid new sanctions targeting Russia’s state-owned Rosneft and private producer Lukoil, along with rules banning refined products made from Russian crude from entering Europe, some Indian refiners — including private refiner Reliance — have reduced purchases of Russian oil.

With limited alternative buyers, Russia is seeking to expand shipments to China. Deputy Prime Minister Alexander Novak said Tuesday that Moscow and Beijing are discussing ways to increase Russian oil exports to China.

Giovanni Staunovo, analyst at UBS, noted: “Market participants are still assessing whether the latest European and US sanctions will meaningfully affect Russia’s oil exports.”

Even so, analysts are primarily focused on the risk of wider imbalances in supply and demand. Deutsche Bank projected a surplus of at least two million barrels per day in 2026, with no clear path back to deficit conditions before 2027, according to a Monday report.

“The trajectory into 2026 remains skewed to the downside,” said analyst Michael Shoh.

Expectations of a weaker market next year continue to outweigh the supportive effect of stalled peace negotiations, which had previously helped prices stabilize. A peace agreement could ultimately lift sanctions on Moscow, potentially releasing large volumes of previously constrained supply into the market.

However, oil continues to find some support from growing expectations that the Federal Reserve will cut interest rates at its December 9–10 policy meeting, after several Fed officials signaled openness to easing.

A rate cut could stimulate economic activity and strengthen oil demand.

“Oversupply concerns are pulling the market one way, while hopes of stronger demand driven by monetary easing are pulling it the other,” Sachdeva said.

Silver prices rose in European trading on Tuesday, extending their gains for a second consecutive session, supported by growing expectations that the Federal Reserve will cut interest rates in December.

Those expectations strengthened after a series of less hawkish remarks from US policymakers. Investors now await additional delayed economic data from the United States to help refine rate-cut pricing.

Price Overview

• Silver prices today: The metal climbed 0.75% to 51.76 dollars an ounce, the highest in a week, up from an opening level of 51.37 dollars. It also recorded an intraday low of 50.81 dollars.

• Upon settlement on Monday, silver gained 2.75% in its first advance in three sessions, rebounding from a two-week low at 48.64 dollars an ounce.

US Interest Rates

• Fed Governor Christopher Waller said Monday that the labor market is weak enough to justify another quarter-point rate cut in December, though any further action will depend on a wave of delayed data following the government shutdown.

• New York Fed President John Williams said Friday he expects the central bank to begin lowering its benchmark rate from here, noting that labor-market weakness now poses a greater economic threat than elevated inflation.

• Following these comments, CME’s FedWatch tool showed the probability of a 25-basis-point rate cut in December rising from 43% to 80%, while the probability of no change fell from 57% to 20%.

• To refine these expectations, investors are awaiting delayed US data due later today, including producer-price figures and September retail-sales numbers.

Outlook for Silver

We at Economies.com expect that if incoming US data proves less hawkish than markets currently assume, expectations for a December rate cut will strengthen further—providing additional positive momentum for non-yielding assets, particularly precious metals such as gold and silver.