Gold prices hit record high amid US government shutdown

On Wednesday, October 1, gold prices reached a record high in Asian trading on Wednesday. This happened against the backdrop of the US government shutdown, UNN reports with reference to investing.com.

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Spot gold reached a record high of $2875.53 per ounce, and December gold futures peaked at $3903.45 per ounce. Spot prices traded slightly below the record, at $3862.22 at 00:22 ET (04:22 GMT).

Spot silver prices rose 0.9% to $47.0525 per ounce on Wednesday, while spot platinum prices fell 0.3% to $1572.18 per ounce.

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According to fintech expert and co-founder of Concord Fintech Solutions Olena Sosedka, such a rapid increase in gold prices is just the tip of the iceberg. She added that the risk of a US government "shutdown", internal political strife in Washington, and expectations of Fed rate cuts have forced capital to flee from stocks to a "safe haven".

According to Olena Sosedka, geopolitical tensions reinforce this movement.

In addition, the rising value of gold means that investors are preparing for a weakening dollar. This is primarily caused by expectations of interest rate cuts by the Federal Reserve. The logic is simple – if the Fed starts to ease its policy, the yield on dollar bonds will fall, and gold will become more attractive. After all, it does not depreciate along with the currency.