Gold prices soared to unprecedented levels on Tuesday, driven by elevated safe-haven demand amid heightened expectations of imminent U.S. Federal Reserve interest-rate cuts.
The yellow metal briefly touched an all-time high of USD 3,977.19 per oz, before settling near USD 3,962.63.
Markets have largely priced in aggressive odds of a rate cut in October and December, citing pressures from weak economic data and increased congressional stalemate in Washington.
According to the CME’s FedWatch tool, probabilities for rate cuts stand at about 93% for October and 82% for December.
Kelvin Wong, senior analyst at OANDA, observed, “These elevated cut probabilities are supporting gold, particularly as the U.S. government shutdown intensifies uncertainty.”
Meanwhile, Kansas City Fed President Jeff Schmid—speaking against the trend—warned against premature easing, citing inflation risks.
Gold’s rally in 2025 has been remarkable: it’s up about 51% year-to-date, bolstered by central bank purchases, inflows into gold-backed ETFs, a weaker U.S. dollar, and growing retail demand as investors look for hedges amid global stress.
Goldman Sachs further raised its December 2026 target to USD 4,900 per oz (from USD 4,300), citing robust demand from central banks and ETF flows.
China’s central bank, meanwhile, continued to add gold to its official reserves—a pattern sustained for the past 11 months.
Other precious metals showed mixed performance: silver was stable near USD 48.49/oz, platinum dipped 0.1%, and palladium nudged up 0.8%