Gold price hits new record as Fed rate decision looms

Ben Graham · Setembro 8

Gold climbed above the $3,600 level for the first time on Monday — setting a new record — as soft US jobs data cemented expectations of an interest rate cut by the Federal Reserve this month.

Spot gold hit an all-time high of $3,636.71 per ounce earlier in the session before pulling back, adding roughly $40 or 1.3% to its previous record from last week.

US gold futures saw a smaller gain of 0.6%, trading at about $3,676 per ounce in New York.

Gold’s momentum continued after Friday’s pivotal US payroll report showed a slowdown in hiring, while the unemployment rate rose to its highest since 2021. With a softer labour market more or less confirmed, investors are almost certain that the Fed will begin cutting interest rates starting next week.

According to the CME FedWatch tool, traders have priced in an 88% chance of a 25-basis-point cut following the Fed’s upcoming meeting on Sept. 16-17. They also see as many as three reductions for the remainder of 2025, a scenario that would benefit gold as the metal yields no interest.

“We look for gold to rise to $3,700/oz by mid next year,” said UBS analyst Giovanni Staunovo in a note to Reuters.

“(Rate cut bets) are boosting the demand of gold. Moreover, the overall geopolitical scenario is extremely uncertain … we should consider that a significant part of the demand is also coming from central bank buying,” added Carlo Alberto De Casa, an external analyst at banking group Swissquote.

With the latest move, gold has now surged about 38% so far this year, building on an already-massive 27% gain in 2024. The rally was driven by a weaker US dollar, strong central bank buying, a soft monetary policy backdrop, as well as geopolitical and economic uncertainty.

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Looking ahead, renewed rate cut hopes will face tests this week from a benchmark revision for US jobs data due on Tuesday, followed by producer and consumer inflation prints on Wednesday and Thursday, respectively.

Investors are also waiting for a landmark ruling on whether US President Donald Trump has legitimate grounds to remove Fed Governor Lisa Cook, which may have significant implications on the future of US central banking.

On that matter, Goldman Sachs Group analysts said last week that gold could rally to almost $5,000 an ounce if the Fed’s independence were damaged, and investors shifted just a small portion of holdings from Treasuries into bullion.

(With files from Bloomberg and Reuters)