Gold Prices Hold Near Record Highs as Fed Rate Cut Looms

Gold prices stayed close to record highs in Asian trading on Monday, supported by expectations that the U.S. Federal Reserve will cut interest rates this week. Spot gold rose 0.1% to $3,645.03 per ounce at 01:29 ET (05:29 GMT), just below last week’s record of $3,673.95. U.S. gold futures dipped 0.1% to $3,682.70 per ounce.

The precious metal gained 1.5% last week, marking a fourth straight weekly rise, and is up nearly 40% year-to-date as investors flock to safe-haven assets amid global economic uncertainty and trade policy concerns under President Donald Trump.

Markets are pricing in over a 96% chance that the Fed will cut rates by 25 basis points on Wednesday, with some bets on a deeper cut. Confidence in a rate reduction strengthened after revised U.S. labor data revealed weaker job growth. August payrolls added only 22,000 jobs, pushing unemployment to 4.3%, the highest in months. Despite a slightly hotter August Consumer Price Index at 0.4% monthly growth, annual inflation held steady at 2.9%. Analysts believe the Fed will prioritize the cooling labor market over inflation concerns.

Gold is particularly sensitive to interest rate changes, as lower rates reduce the opportunity cost of holding non-yielding assets while typically pressuring the dollar, further boosting bullion demand.

Other metals showed limited movement. Silver futures slipped 0.2% to $42.76 per ounce, while platinum futures hovered at $1,410.45. Copper prices gained modestly, with London Metal Exchange futures up 0.3% to $10,083.3 a ton and U.S. copper futures rising 0.2% to $4.66 a pound.

Meanwhile, weak Chinese economic data weighed on broader metal sentiment. Industrial production growth slowed to its weakest pace in a year, while retail sales also underperformed expectations, highlighting ongoing challenges for the world’s largest commodity consumer.