Gold hits record as markets bet on fresh Fed rate cuts
Gold hit a new all-time high as investors prepared for more U.S. interest rate cuts and waited for this week's inflation data to confirm the Federal Reserve's policy direction.
Spot gold reached a record intraday high around $3,719 per ounce. U.S. December futures climbed above $3,750. The gains followed expectations of more Federal Reserve rate cuts after last week's quarter-point reduction.
This Friday brings the Personal Income and Outlays report, which includes the core PCE price index – the Fed's preferred inflation measure. The Bureau of Economic Analysis will release August data on September 26 at 8:30 a.m. ET. Traders say this report could determine the size and timing of future rate cuts this year.
This Friday brings the Personal Income and Outlays report, which includes the core PCE price index – the Fed's preferred inflation measure. The Bureau of Economic Analysis will release August data on September 26 at 8:30 a.m. ET. Traders say this report could determine the size and timing of future rate cuts this year.
The strength spread across other precious metals, with silver approaching multi-year highs while platinum and palladium also gained. Analysts linked the rally to expectations of lower rates, ongoing central bank purchases, and renewed Western investor interest through exchange-traded funds.
The Federal Open Market Committee cut the federal funds rate by 25 basis points last week to a 4.00%-4.25% target range. This marked the first cut since December. One member dissented, favoring a larger half-point cut.
Interest-rate futures are signaling confidence in further easing this year, with traders expecting two additional quarter-point cuts – one in October and another in December. Investors are also watching remarks from Federal Reserve officials, including Chair Jerome Powell, for clues on the path ahead.
UBS analyst Giovanni Staunovo expects gold to reach new record highs this week, citing the prospect of more cuts alongside the Fed's data-dependent approach.
Demand for gold emerged early in 2025 and has persisted since — the metal has gained more than 40% since January. Recent flows show Western investors are primarily increasing exposure through funds. However, gold remains particularly sensitive to inflation and labor market data that influence Fed decisions.
The Federal Open Market Committee cut the federal funds rate by 25 basis points last week to a 4.00%-4.25% target range. This marked the first cut since December. One member dissented, favoring a larger half-point cut.
Interest-rate futures are signaling confidence in further easing this year, with traders expecting two additional quarter-point cuts – one in October and another in December. Investors are also watching remarks from Federal Reserve officials, including Chair Jerome Powell, for clues on the path ahead.
UBS analyst Giovanni Staunovo expects gold to reach new record highs this week, citing the prospect of more cuts alongside the Fed's data-dependent approach.
Demand for gold emerged early in 2025 and has persisted since — the metal has gained more than 40% since January. Recent flows show Western investors are primarily increasing exposure through funds. However, gold remains particularly sensitive to inflation and labor market data that influence Fed decisions.
Recommended