Gold prices pushed even higher in Asian markets on Thursday, notching yet another all-time high as investors positioned for potential interest rate cuts from the Federal Reserve and reacted to escalating U.S.-China trade frictions. It was the fourth consecutive session in which the yellow metal set a fresh record.
Spot gold rose 0.7% to $4,237.87 per ounce by 00:25 ET (04:25 GMT), after briefly hitting $4,241.99 earlier in the day. U.S. Gold Futures gained 1.2% to $4,252.59. The metal has surged more than 5% this week alone, building on a strong upward run since early October.
Rate Cut Expectations Drive Momentum
Markets are now almost fully pricing in a 25 basis-point cut at the Fed’s October meeting, followed by another in December. This comes after Chair Jerome Powell struck a more dovish tone in his comments earlier this week, reinforcing investor bets on monetary easing.
The Fed’s Beige Book, released Wednesday, noted that “U.S. economic activity was little changed in recent weeks,” highlighting softer demand and cost pressures. It also pointed to “early signs of cooling” in the labor market, a key factor supporting lower rate expectations and lifting non-yielding assets like gold.
Geopolitics and Shutdown Add Fuel to the Rally
The safe-haven trade intensified further after Washington threatened new tariffs on Chinese goods and Beijing retaliated by expanding export controls on rare earth materials. Mounting tensions between the world’s two largest economies sparked renewed fears of a broader trade war, driving investors into gold.
Meanwhile, the ongoing U.S. government shutdown, now entering its third week, has created additional uncertainty by delaying economic data releases and raising concerns over fiscal gridlock in Washington.
Analysts See More Upside Ahead
Analysts at ANZ said they expect gold’s rally to extend amid this backdrop of geopolitical risk and looser monetary policy.
“While comparisons are being made to the 1980’s price peak, the current price rise is underpinned by structural drivers, indicating that elevated prices will likely sustain,” analysts wrote.
They project gold to reach $4,400 an ounce by the end of 2025, potentially peaking around $4,600 by mid-2026 before moderating later in the year.
Other Metals Trade Quietly
The rally was less pronounced in other metals. Silver prices edged up 0.3% to $53.13 an ounce, just shy of record levels at $53.6 earlier this week, while Silver Futures rose more than 1%.
“The factors driving gold are also supporting silver’s momentum. Investors who missed the rally in gold prices are now turning their attention to the white metal for exposure,” ANZ analysts added.
Platinum Futures were flat at $1,698.00/oz.
In industrial metals, Benchmark Copper Futures on the London Metal Exchange were little changed at $10,616.20 per ton, while U.S. Copper Futures added 0.2% to $4.98 per pound.
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