Gold Hits All-Time High as Fed Rate-Cut Hopes Bolster Appeal
Gold prices rose more than 1% to hit a record high on Thursday, helped by expectations of an interest rate cut by the Federal Reserve next week after U.S. data signalled a slowing of the economy.
Spot gold was up 1.7% at $2,554.05 per ounce, as of 02:10 p.m. ET (1810 GMT). U.S. gold futures settled 1.5% higher at $2,580.60.
The U.S. Labor Department said initial claims for state unemployment benefits rose 2,000 to a seasonally adjusted 230,000.
U.S. producer prices increased slightly more than expected in August amid higher costs for services, but the trend remained consistent with subsiding inflation.
Markets are currently pricing in an 73% chance of a 25-basis-point U.S. rate cut at the Fed's Sept. 17-18 meeting, and a 27% chance of a 50-bps cut, the CME FedWatch tool showed.
"The labor market is continuing to falter and if the labor market deteriorates, the journey that they'll embark on in cutting rates is going to go for an extended period of time," said Phillip Streible, chief market strategist at Blue Line Futures.
Spot silver up 3.7% at $29.76 and platinum gained 3% to $979.62, hitting its highest level in near two months.
Source : Reuters
