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Spot gold prices continued their record-breaking surge on Tuesday, settling at a new all-time high of $3,697.17 per ounce, with U.S. gold futures for December reaching $3,731.85 ahead of a potential move to resume rate cuts by the Federal Reserve.
The rally followed Monday’s peak of about $3,685 per ounce, with a weakening U.S. dollar adding support.
The U.S. Dollar Index dropped to 97.10, its lowest level in more than seven weeks, while the euro climbed above 1.18 against the dollar.
Markets are broadly expecting a 25-basis-point rate cut at the conclusion of the Fed’s two-day policy meeting on September 17, with a smaller chance of a 50-basis-point cut, according to futures pricing from the CME FedWatch tool.
The central bank will also release updated economic projections, known as the "dot plot," followed by a press conference with Chair Jerome Powell.
Lower borrowing costs generally reduce the opportunity cost of holding gold, a non-yielding asset, while a weaker dollar makes bullion cheaper for investors holding other currencies.
U.S. President Donald Trump has amplified pressure on the Fed, urging Powell in a social media post to deliver a "bigger" cut.
Reports that economic adviser Stephen Miran may soon join the Fed, along with Trump’s attempt to dismiss Governor Lisa Cook, have reinforced expectations of a more accommodative monetary policy stance.
The World Gold Council said gold-backed exchange-traded funds attracted $1.8 billion in net inflows during the week ending September 12.
SPDR Gold Trust, the world’s largest such fund, reported that its holdings rose to 976.80 metric tons on Monday, up from 974.80 tons on Friday.
Silver was steady at $42.73 per ounce, just below its highest level in 14 years. Platinum slipped 0.2% to $1,398.84, while palladium also fell 0.2% to $1,182.25.
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