Gold hits record as Fed cut hopes grow
Investors eye U.S. data as markets bet on lower rates
Gold climbed to record highs as investors awaited key U.S. economic data that could reinforce expectations of a Federal Reserve rate cut later this month. Markets are pricing in an 89% chance of a 25 basis-point cut, with some participants hoping weaker data could prompt a larger reduction. Attention centers on sequential labor-market releases—job openings, private payrolls and the U.S. nonfarm payrolls report—which will help clarify the tightening or easing of employment conditions that are central to Fed deliberations.
The prospect of lower U.S. interest rates and a softer dollar supported both equities and commodities: Wall Street hovered near record highs while gold surged, touching a spot high of $3,508.50 per ounce and trading around $3,496 after a slight pullback. U.S. gold futures moved even higher, near $3,565.50. The rally has lifted gold more than 30% year-to-date, marking one of the metal’s strongest runs in history. Silver also advanced, reaching about $40.79 per ounce.
Analysts attribute the rally to expectations of Fed easing, weaker economic signals, political pressures on central-bank independence, and concerns over slowing global growth—factors that have weakened confidence in the dollar and bolstered demand for safe havens. Central banks, especially in emerging markets, have been increasing gold reserves to diversify away from dollar assets, adding structural support to prices.
While strategists warn that the rapid ascent raises the risk of sharp corrections, many say fundamentals favor continued demand if the outlook for lower U.S. rates persists. The surge is being read as both a symptom of heightened global uncertainty—spanning inflationary pressures and geopolitical tensions—and an indicator that the era of ultra-tight U.S. monetary policy may be drawing to a close.
