Gold punches through US$3,500 to hit record high on Fed rate cut bets
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Gold has gained more than 30 per cent in price so far in 2025.
PHOTO: REUTERS
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Melbourne - Gold hit a record high as the prospect of Federal Reserve rate cuts and growing concerns over the US central bank’s future gave fresh legs to the multiyear rally in precious metals.
Bullion for immediate delivery rose as much as 0.9 per cent to an all-time high of US$3,508.73 an ounce in early trading in Asia on Sept 2, surpassing the previous peak reached in April.
So far in 2025, the precious metal has gained more than 30 per cent, making it one of the best-performing commodities.
Gold is the go-to haven asset amid political and economic turmoil and typically benefits from a lower-rate environment. The metal has also found support in 2025 as investors seek safety from market turmoil fuelled by US President Donald Trump’s global trade war.
Mr Trump’s escalating attacks on the Fed has become the latest cause for investor alarm, with concerns over the central bank’s independence threatening to erode confidence in US assets like the dollar.
The latest run has been underpinned by expectations that the US central bank will reduce interest rates in September, after Fed chair Jerome Powell cautiously opened the door to a reduction.
A key US jobs report on Sept 5 is likely to add to signs of an increasingly subdued labour market – supporting the case for cuts. That is boosted the allure of precious metals, which do not pay holders interest. BLOOMBERG
