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Gold prices surged to fresh records in Asian trade on Wednesday after the U.S. government officially entered a shutdown, fueling haven demand and weighing on the dollar.
Spot gold touched an all-time high of $3,875.53 an ounce, before easing slightly to $3,862.22 by 00:22 ET (04:22 GMT). Gold futures for December also soared to a peak of $3,903.45/oz.
The surge marks the latest in a string of record-breaking sessions this week, driven by deepening political turmoil in Washington and fading confidence in the dollar.
U.S. Government Shutdown Begins
A shutdown took effect at midnight Tuesday (0400 GMT Wednesday) after Republicans’ last-ditch spending bill failed to clear the Senate amid resistance from Democrats over healthcare and social spending provisions.
The deadlock halted federal funding, setting in motion agency closures and sparking worries that the release of critical economic data will be delayed. Traders fear that a prolonged disruption could cloud monetary policy visibility for the Federal Reserve.
Haven Demand Extends to Silver and Platinum
The political impasse drove strong inflows into precious metals beyond gold. Spot silver climbed 0.9% to $47.05/oz, nearing a 14-year high, while platinum edged down 0.3% to $1,572.18/oz after touching its strongest levels in over a decade earlier this week.
Industrial metals were more muted. London copper futures eased 0.1% to $10,278.10 a ton, while COMEX copper slipped 0.7% to $4.8450 a pound after a strong rally earlier this week.
Nonfarm Payrolls Data in Doubt
The shutdown has cast uncertainty over the release of September’s nonfarm payrolls report, which was due Friday and considered a key guide for Fed policy. A prolonged closure would also delay other economic releases, complicating the Fed’s decision-making.
While the central bank cut rates in September to support a cooling labor market, several officials have since struck a hawkish tone. Dallas Fed President Lorie Logan warned this week that more cuts may be unwarranted unless job conditions weaken further, tempering hopes for aggressive easing.
