Gold prices advanced in Asian markets on Monday, remaining near last week’s record levels, driven by optimism over additional U.S. interest rate cuts following the Federal Reserve’s recent move.
The metal’s gains were tempered by a modest rebound in the U.S. dollar, which has recovered from its lowest point in more than three years. Spot gold rose 0.3% to $3,697.70 per ounce, while gold futures climbed 0.7% to $3,733.10/oz as of 01:33 ET (05:33 GMT). Last week, spot gold peaked at $3,707.70/oz.
Fed Rate-Cut Boosts Precious Metals
Gold’s recent rally followed the Fed’s 25-basis-point rate cut, aimed at offsetting increasing labor market risks. The central bank indicated that further rate reductions could be implemented if labor market weakness persists, although concerns about inflation, particularly from trade tariffs, remain.
Markets anticipate at least another 50-basis-point cut this year, according to CME FedWatch data. Lower rates generally favor non-yielding assets like gold, reducing the cost of holding bullion. Other metals also benefited from the Fed’s action: spot platinum rose 0.8% to $1,419.90/oz, while spot silver advanced 1.3% to $43.6495/oz. Copper futures on the London Metal Exchange increased 0.1% to $10,001.10 per ton, and COMEX copper rose 0.1% to $4.6315 per pound.
Focus on U.S. Economic Data and Fed Speeches
Investors are watching a series of key U.S. economic reports this week that could influence near-term interest rate expectations. Fed Chair Jerome Powell is scheduled to speak on Tuesday, while several other officials will also provide commentary.
The PCE price index, the Fed’s preferred inflation measure, is due Friday and is expected to show that core inflation remains above the 2% annual target. Additional releases this week include preliminary purchasing managers’ index readings for September and the final GDP growth figure for Q2.
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