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Gold prices hit all-time highs in Asian trading on Monday, with investors flocking to the safe-haven asset amid mounting concerns over a possible U.S. government shutdown and continued bets on Federal Reserve rate cuts.
Spot gold surged to $3,812.00 an ounce, while December futures touched $3,839.05/oz, extending a rally supported by both geopolitical and policy-driven uncertainty.
Haven Demand Strengthens as Shutdown Looms
Investor anxiety grew as U.S. lawmakers faced a September 30 deadline to avoid a government shutdown. With funding set to expire, bipartisan talks remain deadlocked:
- Republicans are pushing for a short-term stopgap bill until November.
- Democrats demand a reversal of cuts to healthcare and Medicaid before approving further measures.
- President Donald Trump is scheduled to mediate talks on Monday with Congressional leaders from both parties.
A prolonged shutdown could delay key economic data releases, including nonfarm payrolls, while also threatening to disrupt U.S. economic activity. The last major shutdown (2018–2019) cost the economy an estimated $11 billion in GDP, according to the Congressional Budget Office.
Silver and Platinum Surge to Decade-Highs
While gold set fresh records, silver and platinum outpaced bullion, marking their strongest levels in more than a decade:
- Spot silver jumped over 2% to $47.18/oz, its highest in 14 years.
- Spot platinum climbed 3.2% to $1,626.06/oz, the strongest since 2012.
The moves highlight broader investor appetite for precious metals as hedges against policy and economic uncertainty.
Fed Rate Cut Bets Add Support
Beyond haven flows, the metals complex benefited from expectations of further monetary easing:
- Friday’s PCE price index data (the Fed’s preferred inflation gauge) came in line with forecasts.
- Despite core PCE inflation remaining well above the 2% target, markets are pricing a 91.9% chance of a 25 bps cut in October and a 64.2% chance of another in December (CME FedWatch).
Lower rates reduce the opportunity cost of holding non-yielding assets such as gold, making bullion more attractive.
Industrial Metals Track Gains
Industrial metals also joined the rally:
- LME copper futures rose 0.6% to $10,276.45/ton.
- COMEX copper futures gained 1.3% to $4.81/pound.
The gains came despite ongoing trade concerns and potential disruption from new tariffs announced by the Trump administration.
