The gold price has surged to an all-time high above $3,500 an ounce, extending its winning streak to a sixth consecutive session as investors bet on imminent US interest rate cuts and fretted over political threats to central bank independence.
Spot gold climbed to $3,508.73 in early Tuesday trading before easing back to $3,496.40, still up 0.57%. US gold futures for December delivery advanced 1.4% to $3,564.40 an ounce.
According to the CME FedWatch tool, traders now see an 89.7% chance of a 25-basis-point Federal Reserve rate cut at its September 17 meeting. Lower interest rates reduce the opportunity cost of holding non-yielding assets such as gold, making the metal more attractive to investors.
The rally builds on months of momentum driven by safe-haven demand, as market volatility, inflation pressures, and geopolitical tensions have boosted appetite for bullion.
The latest surge also comes amid heightened concerns over the independence of the Federal Reserve. Christine Lagarde, president of the European Central Bank, warned that US President Donald Trump risked inflicting “very serious” damage on the US and global economy if he moved to sack Fed chairman Jerome Powell or governor Lisa Cook.
Trump has repeatedly clashed with the Fed, demanding deeper rate cuts and questioning its handling of inflation. Analysts say any attempt to remove senior Fed officials would rattle markets further, fuelling demand for safe-haven assets such as gold.
A perfect storm for bullion
Analysts suggest that with interest rates expected to fall, inflation still elevated, and political uncertainty mounting, the conditions are ripe for further gold gains. Some market strategists now predict bullion could test $3,600 an ounce in the coming weeks if the Fed follows through with its rate cut.
For investors and businesses, the latest milestone underscores gold’s continuing role as a hedge against both economic and political instability — at a time when confidence in the global monetary order is being tested.