By Anjana Anil
(Reuters) – Gold soared to a record high on Wednesday as expectations for another big rate cut by the U.S. Federal Reserve bolstered bullion’s bull rally, and a softer dollar added to the metal’s appeal.
Spot gold gained 0.4% to $2,667.03 per ounce by 1409 GMT, after hitting an all-time high of $2,670.43 earlier. U.S. gold futures gained 0.6% to $2,691.40.
“I think we are still riding the wave of central bank easing, the likelihood of more to come, I think we’re also adding on to the expectations of a weaker dollar,” said David Meger, director of metals trading at High Ridge Futures.
The U.S. dollar steadied to near 14-month lows against a basket of peers, making gold less expensive for overseas buyers. [USD/].
The Fed cut rates by 50 basis points last week, and investors see about 58% chance of another 50 bps cut in November, according to CME FedWatch Tool.
Lower interest rates boost non-yielding gold’s appeal.
Traders await Fed Chair Jerome Powell’s remarks and U.S. inflation data later this week for further policy cues.
“We could see $2,700 per ounce level in the next day or two if we continue to see weakening labour, and if we see the Fed presidents all reaffirming 50 basis point cuts,” said Phillip Streible, chief market strategist at Blue Line Futures.
Bullion has risen over 29% so far in 2024, with gains attributed to central bank easing and geopolitical issues.
ETF flows and ancillary factors including geopolitical tensions across the Middle East and the massive stimulus measures put in place by China continue to support and drive gold prices higher over the course of the last several weeks and today, Meger said.
Spot silver rose 0.1%% to $32.17 per ounce, having reached its highest levels since May earlier. Platinum added 1.2% to $997.80 and palladium shed 0.5% to $1,051.75.
(Reporting by Anjana Anil in Bengaluru, Editing by Nick Zieminski)
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