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Gold prices surged to fresh all-time highs in Asian trading on Wednesday, extending a powerful multi-week rally as traders piled into safe-haven assets on expectations of imminent U.S. interest rate cuts and renewed U.S.-China trade frictions.
Spot and Futures Prices Hit New Peaks
Spot gold climbed 1.1% to $4,186.84 per ounce by 06:05 GMT, after reaching a new record of $4,193.6/oz earlier in the session. U.S. December Gold Futures rose 1% to $4,203.27, with both benchmarks marking a third consecutive record-setting session.
The metal has now rallied for eight straight weeks, supported by a confluence of monetary, geopolitical, and inflation-related drivers.
Powell’s Dovish Remarks Fuel Rate-Cut Hopes
The latest leg of the rally came after Federal Reserve Chair Jerome Powell delivered comments perceived as dovish on Tuesday. Powell said the U.S. economy remains resilient but acknowledged signs of a softening labor market, suggesting that the Fed may slow or end its quantitative tightening (QT) program.
His remarks reinforced expectations that the central bank could cut rates in both October and December, pressuring U.S. Treasury yields and the dollar, which boosted demand for non-yielding gold.
Analysts at ING noted that gold and silver have been among the top-performing commodities of 2025, rising more than 55% and 80% year-to-date, respectively, as investors hedge against geopolitical and monetary uncertainty.
Trade Tensions Reinforce Haven Demand
The bullish tone was amplified by escalating U.S.-China trade tensions. President Donald Trump suggested that Washington could sever trade ties in the cooking-oil sector, retaliating against Beijing’s decision to curb U.S. soybean imports.
Additionally, both sides imposed reciprocal port fees on shipping firms, further straining trade relations and prompting another wave of safe-haven buying.
Broader Metal Markets Advance
Other metals joined gold’s rally amid a weaker dollar and speculation of more stimulus from China:
- Silver rose 1.4% to $52.12/oz, rebounding from Tuesday’s pullback and staying near its record high of $53.6/oz.
- Platinum Futures gained 1.4% to $1,687.20/oz, tracking the broader precious metals rally.
- Copper prices firmed as well, with London Metal Exchange (LME) copper up 0.7% to $10,667.50 per ton, while U.S. copper futures added 0.8% to $5.04 per pound.
China’s Deflation Data Signals Policy Action Ahead
China’s latest inflation data revealed persistent deflationary pressures—with consumer prices down 0.3% year-on-year in September and producer prices falling 2.3%, both slightly better than August but still signaling weak domestic demand.
Economists expect Beijing to introduce new fiscal and monetary support to counter deflation, a move that could further support commodity demand and global market sentiment.
Outlook
With geopolitical risk rising, economic data softening, and the Fed likely to pivot toward further easing, analysts expect gold’s bullish trend to continue in the near term. However, some caution that volatility may rise as markets balance rate expectations with potential diplomatic breakthroughs between Washington and Beijing.
