Gold Surges to Record High Amid Rate Cut Bets and Uncertainty

Gold prices soared to unprecedented levels on Monday, surpassing $3,800 per ounce for the first time as global investors sought safety amid economic and political uncertainty.

Spot Gold jumped 1.6% to $3,820.96 per ounce by mid-morning in New York, after briefly touching a record high of $3,831.19. U.S. gold futures for December delivery also climbed, rising 1.1% to $3,850.80.

The surge in gold was fueled by several factors including expectations of U.S. Federal Reserve rate cuts, a 0.3% drop in the U.S. dollar index, concerns over a potential government shutdown, and escalating geopolitical tensions.

David Meger, director of metals trading at High Ridge Futures, noted: 'Safe-haven demand focused on the potential U.S. government shutdown is one of the driving factors behind gold’s rally. The dollar is under some light pressure in response to that, certainly supporting the precious metals complex.'

Market sentiment for gold was further bolstered by the U.S. Personal Consumption Expenditures Price Index, which matched expectations and reinforced speculation that the Federal Reserve may cut rates at its upcoming October and December meetings.