Investors continue to anticipate a 25-basis-point rate cut at the Fed meeting this month, followed by a similar reduction in December
[BENGALURU] Gold prices climbed to a record high on Tuesday (Oct 14) as renewed US-China trade tensions exacerbated broader uncertainty, bolstering safe-haven demand, while the prospects of US rate cuts lent support, with silver also reaching an all-time peak.
Spot gold was up 0.4 per cent at US$4,124.79 per ounce, as at 8.29 am, after having hit an all-time high of US$4,131.52 earlier in the session.
US gold futures for December delivery gained 0.3 per cent to US$4,143.10.
Safe-haven gold has surged 57 per cent year-to-date, surpassing the crucial US$4,100 milestone for the first time on Monday, bolstered by geopolitical and economic uncertainties, rate-cut expectations, strong central bank buying, and strong ETF inflows.
Spot silver was up 0.3 per cent at US$52.49 per ounce, after hitting US$52.70 earlier in the day, supported by factors driving gold and tightening in the spot market.
US President Donald Trump remains on track to meet Chinese leader Xi Jinping in South Korea in late October, US Treasury Secretary Scott Bessent said on Monday.
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The latest tensions followed China’s announcement on Thursday to expand rare-earth export controls, prompting Trump to respond with a 100 per cent tariff threat on Chinese imports and export controls on critical US-made software starting Nov 1.
The ongoing US federal government shutdown, now in its 13th day, is starting to affect the nation’s economy, Bessent noted.
Bank of America and Societe Generale analysts now forecast gold to hit US$5,000 by 2026, while Standard Chartered raised its 2026 average forecast to US$4,488.
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Meanwhile, Philadelphia Federal Reserve chief Anna Paulson said that rising risks to the labour market bolster the case for further US interest rate cuts.
US Federal Reserve chair Jerome Powell is set to address the Nabe annual meeting on Tuesday, which may provide fresh cues on rate cuts.
Investors continue to anticipate a 25-basis-point rate cut at the Fed meeting this month, followed by a similar reduction in December.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.17 per cent to 1,018.88 tonnes on Monday from Friday.
Elsewhere, platinum climbed 0.5 per cent to US$1,653.45 and palladium gained 1.6 per cent to US$1,498.25, hitting its highest level since May 2023. REUTERS
