Gold prices climbed to record territory in Asian markets on Wednesday as the U.S. government entered a shutdown after Congress failed to pass new federal funding.
Spot gold touched $2,875.53 per ounce, while December futures reached a peak of $3,903.45/oz. By early Asian trading at 00:22 ET (04:22 GMT), spot gold traded slightly below its peak at $3,862.22/oz.
Shutdown Begins Amid Congressional Stalemate
The shutdown started at midnight Tuesday (0400 GMT Wednesday) after a last-minute spending bill, supported by Republicans, was blocked in the Senate due to ongoing Democratic opposition.
The political deadlock has increased safe-haven demand, sending gold to a series of record highs this week and weakening the U.S. dollar.
Other precious metals followed suit, with silver and platinum reaching multi-year highs. On Wednesday, spot silver gained 0.9% to $47.0525/oz, while platinum fell 0.3% to $1,572.18/oz.
Industrial metals had seen strong gains earlier in the week, but some retreated on Wednesday. London Metal Exchange copper futures slipped 0.1% to $10,278.10 per ton, and COMEX copper fell 0.7% to $4.8450.
Employment Data Could Be Delayed
The shutdown is expected to postpone the release of key labor market data, including the September nonfarm payrolls report. This report is vital for gauging U.S. employment trends and was a major factor behind the Federal Reserve’s September rate cut.
“Dallas Fed President Lorie Logan flagged heightened caution over future interest rate cuts, stating that the labor market will need to deteriorate further for the central bank to consider more rate cuts,” market watchers said.
Extended federal closures could also delay other economic indicators, adding uncertainty for investors as they monitor the implications for growth and monetary policy.
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