By Anmol Choubey
(Reuters) -Gold prices touched another record high on Tuesday driven by strong investment demand amid broader geopolitical and economic uncertainty with additional support from expectations of further U.S. interest rate cuts.
Spot gold held its ground at $3,957.60 per ounce by 0953 GMT, after hitting an all-time high of $3,977.19 earlier in the session.
U.S. gold futures for December delivery were steady at $3,980.10.
“Strong ETF demand remains key, driven by ‘FOMO’ and eroding trust in traditional safe havens,” said Ole Hansen, head of commodity strategy at Saxo Bank, adding that ongoing central bank demand and lower funding costs were also supporting bullion.
The White House on Monday eased back on President Donald Trump’s claim that layoffs of government employees were underway due to the ongoing shutdown but warned that job losses could occur as the impasse entered its seventh day.
The shutdown has postponed the release of key economic indicators, forcing investors to rely on secondary, non-government data to gauge the timing and extent of Fed rate cuts.
Markets continue to price in a 25 basis-point cut at this month’s meeting and a similar-sized reduction in the December meeting. [USDIRPR]
Non-yielding gold thrives in a low interest rate environment and during economic uncertainty.
Gold has climbed 51% so far this year on sizable central bank buying, increased demand for gold-backed exchange-traded funds, a weaker dollar and growing interest from retail investors seeking to hedge amid rising trade and geopolitical tensions.
“I see gold reaching $4,300/oz over next 6 months. As the USD is expected to continue to depreciate,” with the overall macro and geopolitical scenario positive for gold price appreciation, said Michael Langford, chief investment officer at Scorpion Minerals.
Goldman Sachs on Monday raised its December 2026 price forecast for gold to $4,900 per ounce from $4,300.
China’s central bank added gold to its reserves in September for the 11th straight month, data from the People’s Bank of China showed.
Meanwhile, political upheaval in Japan and France gripped currency and bond markets for a second day running on Tuesday. [MKTS/GLOB]
Elsewhere, spot silver was down 0.4% at $48.32 per ounce, platinum fell 0.7% to $1,613.81 and palladium was up 0.3% at $1,323.43.
(Reporting by Anmol Choubey in Bengaluru; Editing by Kate Mayberry)
