Gold prices hold near record highs as Fed decision approaches
Gold prices stayed close to record levels in Asian trade on Monday, after rising for a fourth consecutive week. The gains were supported by growing expectations that the U.S. Federal Reserve will cut interest rates later this week.
Spot gold inched up 0.1% to $3,645.03 per ounce by 01:29 ET (05:29 GMT), just below last week’s record high of $3,673.95. Meanwhile, U.S. gold futures slipped 0.1% to $3,682.70 per ounce.
Bullion advanced 1.5% last week, its fourth straight weekly gain. So far this year, the metal has surged nearly 40%, boosted by safe-haven demand linked to President Donald Trump’s trade policies.
Fed meeting in focus as markets expect rate cut
The Federal Reserve begins its meeting on Tuesday, with an interest rate decision due Wednesday. Traders currently price in a 96% chance of a 25 basis point cut, with a smaller possibility of a larger move.
Confidence in policy easing grew after official jobs data was revised lower, showing clear signs of a cooling U.S. labor market. August payrolls increased by just 22,000, while unemployment climbed to 4.3%.
Although inflation picked up slightly in August, with the Consumer Price Index (CPI) rising 0.4% for the month and 2.9% year-on-year, analysts expect the Fed to focus more on labor market weakness.
Gold is highly sensitive to rate expectations. Lower interest rates reduce the opportunity cost of holding the non-yielding asset and usually weigh on the U.S. dollar, giving bullion further support.
Precious and base metals mixed; weak Chinese data weighs
Other precious metals showed limited movement. Silver futures slipped 0.2% to $42.76 per ounce, while platinum futures held steady at $1,410.45.
In base metals, London copper futures rose 0.3% to $10,083.30 a ton, and U.S. copper futures edged 0.2% higher to $4.66 a pound.
However, weak Chinese economic data added pressure. Industrial production grew at its slowest pace in a year, missing forecasts. Retail sales also cooled from the prior month, signaling weaker domestic demand.
