Gold hovers near record high on US rate-cut hopes, soft dollar
[BENGALURU] Gold prices climbed to a more than four-month high on Tuesday (Sep 2), inching closer to the all-time high touched in April, supported by a weaker US dollar and growing expectations for a US interest rate cut this month.
Spot gold rose 0.5 per cent to US$3,492.50 per ounce as at 9.18 am, the highest since Apr 22, when prices rose to a record high of US$3,500.05.
US gold futures for December delivery gained 1.4 per cent to US$3,563.40.
The US dollar languished near a more than one-month low against its rivals, making gold less expensive for overseas buyers.
Data on Friday showed that the US personal consumption expenditures price index rose 0.2 per cent month on month and 2.6 per cent year on year, both in line with expectations.
Traders are currently pricing in a 90 per cent chance of a 25-basis-points rate cut by the US Federal Reserve at the end of its policy meeting on Sep 17, according to the CME FedWatch tool.
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Non-yielding gold typically performs well in a low-interest-rate environment.
On Monday, US Treasury Secretary Scott Bessent said the Fed is and should be independent but added that it had “made a lot of mistakes” and defended US President Donald Trump’s right to fire Fed governor Lisa Cook over allegations of mortgage fraud.
Trump has criticised the Fed and its chair, Jerome Powell, for months for not lowering interest rates, and recently took aim at Powell over a costly renovation of the bank’s Washington headquarters.
Investors are now looking forward to the US non-farm payrolls data due on Friday to determine the size of the Fed’s expected rate cut later this month.
Elsewhere, spot silver slipped 1.1 per cent to US$40.77 per ounce, after hitting its highest since September 2011 in the last session. Platinum gained 1.1 per cent to US$1,414.45 and palladium rose 0.8 per cent to US$1,128. REUTERS
