Gold Prices Hit Record High Amid Fed Rate Cut Expectations and U.S.-China Trade Tensions

Gold prices surged to a fresh record high in Asian trading on Wednesday, extending their winning streak for the third consecutive session as growing expectations of imminent U.S. interest rate cuts and renewed U.S.-China trade tensions fueled safe-haven demand.

Spot gold climbed 1.1% to $4,186.84 per ounce at 02:05 ET (06:05 GMT), after touching an all-time high of $4,193.6 earlier in the day. U.S. December Gold Futures rose 1% to $4,203.27. The yellow metal has now logged eight straight weeks of gains, with another potential weekly jump on the horizon if the rally continues.

The latest uptrend gained momentum following remarks from Federal Reserve Chair Jerome Powell, which investors interpreted as dovish. Powell noted that while the U.S. economy remains resilient, signs of a weakening labor market are emerging. He emphasized that the Fed’s decisions will continue to be made “meeting by meeting,” reinforcing expectations for possible rate cuts in October and December. Lower Treasury yields and a weaker dollar, both resulting from these expectations, have further boosted demand for non-yielding bullion.

Meanwhile, geopolitical uncertainty added to gold’s appeal. Tensions between the U.S. and China escalated after President Donald Trump suggested severing certain trade ties, particularly on cooking oil imports, in response to Beijing’s reduction in U.S. soybean purchases. Both nations also imposed reciprocal port fees on shipping companies, deepening their trade rift.

According to ING analysts, gold and silver are among the best-performing commodities of the year, up 55% and 80% respectively, driven by central bank easing, geopolitical risks, and strong safe-haven demand.

Other metals mirrored the trend, with silver up 1.4% to $52.12 per ounce, platinum rising to $1,687.20, and copper advancing 0.7% to $10,667.50 a ton. China’s latest inflation data also hinted at persistent deflationary pressures, raising hopes for further government stimulus to support its slowing economy.