Gold Prices Reach Record $3,689 as Investors Anticipate US Fed Rate Cut

Gold reached a new record on September 16, supported by a softer dollar ahead of the US Federal Reserve’s policy meeting, where interest rates are expected to be cut, Reuters reports.

Spot gold rose 0.2% to $3,685.02 an ounce by 0632 GMT, after touching a record $3,689.27 earlier in the session. US gold futures for December delivery edged 0.1% higher to $3,722.70.

«The sentiment is very bullish… markets are buying into rate cuts ahead of this FOMC decision. The outlook remains strong for gold in the short to medium term,» said Capital.com analyst Kyle Rodda.

He warned, however, that if the Fed does not align with market expectations, prices could quickly lose momentum. A dovish stance, by contrast, could push gold beyond $3,700.

US President Donald Trump urged Fed Chair Jerome Powell on September 15 to deliver a «bigger» rate cut. Traders are pricing in a near-certain 25 basis point reduction on September 17, with a smaller possibility of a 50-point cut, according to the CME FedWatch tool. Lower rates reduce the cost of holding bullion and tend to weaken the dollar, making gold more attractive for overseas investors.

The dollar hovered near a two-and-a-half-month low against the euro and close to a 10-month trough against the Australian dollar. SPDR Gold Trust, the world’s largest gold-backed ETF, reported holdings rising 0.21% to 976.80 tonnes on September 15.

Elsewhere, spot silver was flat at $42.73 per ounce, platinum slipped 0.2% to $1,398.84, while palladium declined 0.2% to $1,182.25.

Kursiv also reports that Uzbekistan has secured tenth place in the global ranking of gold producers for 2024.