Spot Gold extended its streak of gains to a fresh all-time high of $3,546.99/oz. on Wednesday, underpinned by rising expectations of a Federal Reserve interest rate cut this month and a heightened safe-haven appeal.
Markets are now pricing in about a 92% chance of a 25 basis point rate cut in September.
This week’s US Non-Farm Payrolls report could provide more clues on the size of the expected rate cut by the Fed.
Lower interest rates tend to reduce the opportunity cost of holding Gold, which pays no interest.
Market uncertainty intensified, lending further support to Gold, after the Trump administration said it would ask the Supreme Court for an expedited ruling on tariffs, which a US appeals court found illegal at the end of last month.
“The Supreme Court decision has seemingly introducing a lot of uncertainty into the market because they could radically change what the macro landscape looks like if these decisions don’t go the president’s way,” Ilya Spivak, head of global macro at Tastylive, was quoted as saying by Reuters.
“The attempt at compromising Fed independence to some extent, that’s a very big deal as well. The bias for gold is very clearly higher, momentum here seems rather one-sided.”
Spot Gold was last up 0.03% on the day to trade at $3,534.44 per troy ounce.
Strong central bank buying, US tariff policies, potential rate cuts by the Federal Reserve and geopolitical uncertainty have fueled Gold’s rally to a series of record highs this year. Year-to-date, the yellow metal has surged 34.68%.
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