Gold touched another record high on Tuesday as momentum continues to build for a US interest rate cut next week.Spot gold hit a new high of $3,673.49 per ounce, surpassing its previous record of $3,636.71 from just a day ago. By noon ET, it retreated to $3,646.64 an ounce, for an intraday gain of 0.3%.US gold futures followed a similar trajectory, rising to as high as $3,715.20 an ounce before pulling back to the $3,680 level.Click on chart for live prices.The move extends gold’s gains to nearly 40% for the year, during which it set multiple records, driven by a soft
dollar, strong central bank buying and heightened global uncertainty.Since the April high of $3,500, bullion has traded within a tight range, with investors monitoring the path of US monetary policy as the global tariffs unleashed by President Donald Trump begin to take effect.In recent weeks, gold began to surge again on expectations that the Federal Reserve will finally begin cutting interest rates after a slew of new US data hinted at an economic slowdown. A lower rate would benefit non-yielding assets such as bullion.“This rally is largely driven by expectations that the Federal Reserve will begin cutting rates, potentially as early as September,” said Bart Melek, head of commodity strategies at TD Securities.The upcoming US producer and consumer price data could offer further cues ahead of the FOMC meeting next week. Traders are currently widely pricing in a 25-basis-point rate cut, with some even betting on a larger 50-basis-point move.“If the US economy does a little weaker, that essentially means that we could see more flows into non-standard asset classes like gold to hedge against that potential decline,” Melek adds. John Ciampaglia, CEO of Sprott Asset Management, said: “We’re very bullish even at $3,600 – we think the markets will continue to rally because we don’t see a shift that’s going to happen with respect to tariff policy, trade relations (or) geopolitics.”(With files from Reuters)
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