Gold exceeds $4,200 and continues to reach the highest level in its history

Gold rose on Wednesday to a new record high, exceeding $4,200 per ounce for the first time ever, driven by growing expectations of further interest rate cuts in the United States. Prices also received support from renewed trade concerns between the United States and China.

Gold rose in instant transactions by 1.40% to $4,200.11 per ounce by 06:59 GMT, after hitting a record level of $4,186.68 earlier in the session. US gold futures for December delivery rose 1.3% to $4,218.

US President Donald Trump announced yesterday, Tuesday, that his administration intends to issue a list on Friday of “democratic programs” that will be closed due to the closure of the federal government, according to Reuters.

Matt Simpson, senior analyst at Stone Group, said, “The US government shutdown and cautious comments from Jerome Powell provided the latest reasons that pushed gold prices to rise.”

Federal Reserve Chairman Jerome Powell said the U.S. labor market remains weak, but the economy “may be on a firmer path than expected.” He added that interest rate decisions are made on a “separate meeting” basis, taking into account the weakness of the labor market and the fact that inflation remains above the target level.

Investors expect a 25 basis point rate cut at the Fed’s next meeting this month, with a similar cut expected in December.

Gold, usually seen as a safe haven, has gained 60% year-to-date, driven by several factors, including geopolitical and economic uncertainty, expectations of lower US interest rates, strong central bank buying, a trend toward reducing reliance on the dollar, and strong inflows into exchange-traded funds.

As for other precious metals, silver jumped 2% to $52.48 after hitting a record high of $53.60 yesterday, tracking gold and due to shrinking supply in the spot market. Platinum rose 1.3% to $1,658.65 per ounce, and palladium rose 0.9% to $1,538.75.