Gold prices surged to new record highs in Asian trading on Thursday, marking the fourth consecutive session, as growing expectations for a US Federal Reserve interest rate cut and renewed trade tensions between the US and China boosted demand for the safe-haven metal. This was reported by UNN with reference to Investing.com.
Details
Spot gold rose 0.7% to $4237.87 an ounce by 00:25 ET (04:25 GMT), after earlier in the session hitting $4241.99. US gold futures rose 1.2% to $4252.59. The metal has gained more than 5% this week, building on strong gains since early October.
Traders are now pricing in an almost guaranteed 25 basis point Fed rate cut in October, followed by another in December, after Chairman Jerome Powell struck a more dovish tone this week.
The Federal Reserve's "Beige Book," released on Wednesday, showed that US economic activity had barely changed in recent weeks, with businesses citing softening demand and persistent price pressures. The report also noted early signs of cooling in the labor market.
The subdued tone reinforced expectations that the Fed would take action to support growth, further boosting gold's appeal as yields decline.
Gold's gains were also underpinned by escalating trade tensions between the US and China after Washington threatened new tariffs on Chinese-made goods and Beijing expanded export controls on rare earth materials.
Renewed friction fueled fears of a broader trade conflict, driving investors into safe-haven assets.
Meanwhile, a prolonged US government shutdown, now in its third week, added another layer of uncertainty. The stalemate has delayed the release of key economic data and raised concerns about fiscal dysfunction in Washington.
Gold and silver prices soared: new record set on October 1414.10.25, 09:48
ANZ analysts said that gold's rally is likely to continue amid growing geopolitical and economic uncertainty and easing US Federal Reserve policy.
While comparisons to the 1980s price peak are being made, the current price surge is underpinned by structural factors, indicating that elevated prices are likely to persist
ANZ expects prices to reach $4400 by the end of 2025 and peak around $4600 by June 2026, before declining in the second half of that year.
Other precious and industrial metals traded in narrow ranges on Thursday, even as the US dollar weakened.
Silver prices rose 0.3% to $53.13 an ounce, just shy of record highs of $53.6 reached earlier this week. Silver futures jumped over 1%.
The factors driving gold are also supporting silver's momentum. Investors who missed out on gold's rally are now turning their attention to the white metal for exposure
London Metal Exchange copper futures were subdued at $10,616.20 a tonne, while US copper futures rose 0.2% to $4.98 a pound.
Recall
According to fintech expert and co-founder of Concord Fintech Solutions Olena Sosedka, the rise in gold prices is a signal for the modern fintech market that while technology can make finance more convenient, trust is based on values proven over centuries.
And geopolitical instability further enhances the importance of gold in the international market. "Wars, trade conflicts, unpredictable decisions of world leaders - all this creates an atmosphere of constant instability, in which gold becomes a universal insurance.
So, the jump in gold's value is not just a financial event, it is a marker of investors' trust in the modern economy," Olena Sosedka summarized. She also added that the rise in gold prices only means that investors are preparing for a weakening dollar. A weaker dollar makes gold cheaper for international buyers, creating a powerful incentive for its price to rise.