Gold prices hit a new all-time high on Tuesday, buoyed by remarks from Federal Reserve Chair Jerome Powell that reinforced hopes for upcoming interest rate cuts. While Powell offered limited details on the timing of these cuts, market participants interpreted his comments as not being strong enough to hinder the ongoing upward momentum in gold.
The record-breaking prices were also supported by increased demand for safe-haven assets amid escalating geopolitical tensions and concerns over the U.S. labor market. This marks the third consecutive day that gold has set a new peak.
According to Wichit Jaitrong, a reporter for Krungthep Turakij citing Reuters, spot gold advanced 0.8%, reaching $3,777.80 per ounce as of 1:45 p.m. Eastern Time. Earlier, prices briefly touched an all-time high of $3,790.82. U.S. gold futures for December delivery also rose, closing up 1.1% at $3,815.70.
The rally coincides with rising geopolitical risks, including NATO warning Russia it will employ “all necessary military and non-military tools” to defend itself following Moscow’s alleged violation of Estonian airspace. Combined with mounting concerns over the U.S. labor market, these factors have driven investors toward gold as a safe haven.
During his speech, Powell provided little insight into the timing of future rate cuts, citing a “challenging situation” with risks of higher-than-expected inflation and weakening job growth. Nevertheless, market participants remain optimistic, with many expecting rate cuts in October and December.
“We understood from his remarks that there was nothing significant enough to halt gold’s upward trend,” said Bob Haberkorn, senior market strategist at RJO Futures.
Market focus now turns to the upcoming release of the U.S. Personal Consumption Expenditures (PCE) index this Friday, a key indicator of inflation for the Federal Reserve.
Other precious metals also gained ground: spot silver increased 0.2% to $44.17 per ounce, nearing a 14-year high; platinum surged 4.5% to $1,480.97, its highest since 2014; and palladium rose 2.8% to $1,212.