Gold spikes to all-time high on rising US rate cut optimism

Gold alloys

Gold prices continued to gain ground today, July 17, with the most active futures contracts recording another fresh record high, as comments from Federal Reserve officials boosted expectations of a September interest rate cut in the US.

Bullion for August delivery soared 0.17%, or $4.30, to $2,472.10 per ounce at 08:55 am Makkah time, after yesterday’s trading ended at an all-time peak of $2,467.80 an ounce. However, spot prices shed 0.13%, or $2.14, to $2,465.75 apiece.

Elsewhere, silver futures for July delivery plummeted by 0.79% to $31.21 an ounce, in tandem with a 0.23% drop in platinum spot prices to $1,001.88 an ounce.

The yellow metal’s record performance coincided with a slight 0.1% decline in the US dollar index, which gauges the greenback's strength against a basket of six currencies, to 104.17 points.

In addition, expectations of the Fed slashing interest rates by 25 basis points at the upcoming September meeting increased to 93.3%, from 91.9% a day ago, and 69.7% a week ago, according to the CME FedWatch Tool.

This came after Fed Chairman Jerome Powell announced last Monday that the US central bank will not wait until the inflation rate reaches the 2% target level to begin easing monetary policy.