Quick overview

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Gold hit a record above $3,800 an ounce for the first time as precious metals surged, with traders weighing the possibility of a US government shutdown that could delay the release of important jobs data this week and cloud the Federal Reserve’s monetary policy path.

 

Bullion jumped 1.4 percent to reach a new high of $ 3,812.05 an ounce following six straight weekly gains, which was higher than the previous high set last Tuesday. As a result of continued market tightness and inflows into exchange-traded funds backed by the metals, silver saw a 23.4% increase, while palladium and platinum also saw notable rebounds.

The dollar declined as investors awaited news ahead of Monday’s scheduled meeting between President Donald Trump and top US congressional leaders. If an agreement on a short-term spending bill cannot be reached, federal funding will expire the day before the meeting. Key data releases, such as Friday’s payrolls report, which analysts predict will show muted job growth in September, would be jeopardized by a shutdown. Most buyers find precious metals to be less expensive when the dollar declines.

The Fed would be more inclined to ease rates at its next rate decision in October if employment data were weaker. This would increase the appeal of non-interest-bearing precious metals. There is still considerable uncertainty surrounding the Fed’s outlook for cutting rates, however, as officials hold differing opinions on monetary policy, and some economic data have surprised everyone with their strength.

Gold has increased 45 percent this year amid central bank demand and the Fed’s decision to resume interest-rate cuts. Holdings of ETFs backed by gold are at their highest point since 2022, and next week’s closing prices are predicted to close out a third straight quarterly gain.