On Tuesday, gold reached a new all-time high in the global market as traders prepared for an expected relaxation of the U.S. Federal Reserve’s monetary policy this week and sought hints on additional rate reductions this year.
Gold prices approached a new high of $3,700 per ounce during Asian trading, as investors maintained optimism about a rate cut by the U.S. Federal Reserve.
Fears regarding the autonomy of the central bank additionally bolstered demand for the precious metal.
Spot Gold rose to $3,679.2 per ounce, following a record high of $3,689.32 during early trading.
December U.S. Gold Futures remained mostly unchanged at $3,719.20/oz.
On Monday, the bullion was priced above $3,682 an ounce, following four weeks of gains.
Investors anticipate a 25-basis-point reduction this week, after indications of weakness in the labor market. Swaps also factor in at least one more cut before the year’s end, with a strong likelihood of a third.
The bullion rose 1% in the last session due to strong expectations of Fed easing, exceeding record highs reached last week.
The rally was supported by a broad market conviction that the Fed will implement a 25-basis-point rate reduction at the conclusion of its September 16-17 gathering, marking its first since December.
A declining U.S. dollar, hovering close to one-week lows, provided additional support.
