Spot gold was trading at record levels, up 0.9% at $2,582.04 an ounce by 1:45 p.m. ET (17:45 GMT).
U.S. gold futures rose 1.2 percent to settle at $2,610.70.
Gold market The bulls are setting their sights bullion prices hitting new records, with a milestone of $3,000 per ounce approaching, driven by monetary easing by major central banks and a tight US presidential election race.
The stars are aligned in favor of gold and silver market bulls as the European Central Bank cut its key interest rate this week, the Fed is likely to cut it next week and keep an eye on U.S. inflation data, said Jim Wyckoff, senior market analyst at Kitco Metals.
Markets are already pricing in a rate cut next week, with a 57% chance of a 25 basis point rate cut and a 43% chance of a 50 basis point cut, CME Federal Reserve Watch According to Commerzbank analysts, this would be the Fed’s first rate cut since 2020. “The market continues to expect the Fed to cut interest rates by around 100 basis points before the end of the year, i.e. rates would have to be reduced by 50 basis points at one of the two remaining meetings after September. The gold price is therefore likely to be rising due to these aggressive expectations of interest rate cuts in the coming months.”
Another factor boosting interest in bullion was the dollar’s fall to its lowest level of the year against the Japanese yen on Friday.
Physically-backed gold exchange-traded funds globally recorded a fourth consecutive month of inflows in August, the World Gold Council said last week.
Holdings of the world’s largest gold-backed ETF SPDR Gold Trust hit their highest levels since early January on Thursday.
From a technical perspective, the Relative Strength Index currently at 69 suggests that the gold price is approaching “overbought” territory, starting at 70.
Palladium rose 2% to $1,067.43 and is up about 17% so far this week.
Spot silver rose 2.3% to $30.61 and platinum added 2.4% to $1,000.57.
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