Gold surged to fresh record highs on Monday, as traders turned focus towards upcoming U.S. economic data following its recent interest rate reduction, while escalting tensions in the Middle East also drove safe-haven demand.
As of 2:15 pm AEST (4:15 am GMT), spot gold was up 0.4% at $2,630.44 an ounce, following a 1.7% rise last week.
The market is focused on key economic reports due later this week, including US personal consumption expenditures (PCE) and jobless claims, which are anticipated to shed light on whether last week’s 50-basis-point rate cut by the Federal Reserve will mark the beginning of more aggressive monetary easing.
Federal Reserve Governor Christopher Waller suggested on Friday that he might support a quarter-point rate cut at each of the upcoming Fed policy meetings in November and December, provided that economic conditions unfold as expected. However, he also noted the possibility of another half-percentage-point cut if the US job market weakens further.
Beyond the US economic outlook, gold traders are keeping a close eye on escalating tensions in the Middle East. Ongoing clashes between Hezbollah and Israel have raised fears that the conflict could spread across the region, which would likely increase gold’s appeal as a safe-haven asset.
Other precious metals were mixed, with silver edging lower and both palladium and platinum experiencing declines.