Gold smashes record $3,895 as Fed cut bets intensify
Gold price surges on Wednesday and posts a record high of $3,895, yet it has since retreated somewhat, trading with gains of over 0.30%. The shutdown of the US government and softer-than-expected employment data reaffirmed investors' stance that the Federal Reserve (Fed) would reduce interest rates at its upcoming meeting.
XAU/USD trades at $3,871 at the time of writing, propelled by falling US Treasury yields and a firm US Dollar.
Financial markets remain in a positive mood, despite the shutdown of the US government, which could delay the release of the Friday Nonfarm Payrolls report. Jobs data revealed earlier showed that private hiring plunged in September, according to the ADP National Employment Change report.
Other data showed that manufacturing activity recovered in September, but remained in contractionary territory, as revealed by the Institute for Supply Management (ISM).
In the meantime, the Greenback post modest losses of over 0.11%, a tailwind for Bullion prices.
Expectations that the Federal Reserve would reduce rates at the October 29 meeting remain high, standing at 98% for a 25-basis-point rate cut and a 4% chance of holding rates unchanged.
Source : Fxstreet.com
