Gold Price: Gold hits record high after US Federal Reserve implements 50 basis point rate cut

Gold prices rose to a record high on Wednesday after United States Federal Reserve cut interest rates by 50 basis points, causing the dollar to fall.

Gold spot Gold rose 0.9% to $2,592.39 an ounce by 14:17 ET (1817 GMT). U.S. gold futures closed up 0.2% at $2,598.60.

“Gold is up to record highs, but bond yields are up too. A 50 basis point rise is good for gold,” said Tai Wong, an independent metals trader based in New York.

“Gold is in a bull market; it is likely to go higher. The speed of that move will depend on Powell’s tone.”

The U.S. central bank on Wednesday began what is expected to be a continued easing of monetary policy with a half-percentage point cut.


Policy makers see the Federal ReserveThe Fed’s benchmark rate is set to fall another half percentage point by the end of this year and another full percentage point in 2025. Lower interest rates reduce the opportunity cost of holding non-yielding bullion and weigh on the dollar, making gold cheaper for investors holding other currencies. Following the Fed’s cut, the dollar fell 0.5% to its lowest level since July 2023 against its rivals.

Investors are now eagerly awaiting the president’s comments. Jerome Powell at 1830 GMT for further clues on the policy trajectory.

Meanwhile, spot silver rose 0.6% to $30.93 an ounce, after hitting a two-month high on Monday.

“Following a recent sell-off, silver prices are recovering as gold prices rise. Speculative and exchange-traded fund (ETF) holdings of silver are increasing,” ANZ said in a note.

Platinum was steady at $981.10 an ounce. Palladium was down 3.2% at $1,081.00. (Reporting by Anushree Mukherjee and Brijesh Patel in Bengaluru; Editing by Krishna Chandra Eluri)

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