Global Markets Update, October 2 – Gold prices climbed to fresh record highs on Wednesday as investors flocked to safe-haven assets amid rising fears of a potential US government shutdown. Weak US labour market data also bolstered expectations of further interest rate cuts by the Federal Reserve.
Price Action
- Spot gold rose 0.4% to $3,872.87 per ounce (as of 0206 GMT).
- US gold futures (December delivery) gained 0.7% to $3,901.40.
- The dollar index hovered near a one-week low, making dollar-priced gold more attractive for overseas buyers.
Key Drivers Behind the Rally
Nicholas Frappell, Global Head of Institutional Markets at ABC Refinery, said gold’s rally is being driven by:
- Concerns over a weaker US dollar.
- The political standoff in Washington over a possible government shutdown.
- Broader geopolitical uncertainties weighing on investor sentiment.
“Gold is benefiting as a classic safe-haven play in times of heightened global uncertainty,” Frappell noted.
Wider Market Context
- Rising shutdown risks in the US are pushing investors toward safe assets.
- Soft labour data is reinforcing bets that the Federal Reserve will ease monetary policy further.
- A weaker dollar has magnified gold’s appeal for international buyers.
Sponsored & Related Market Stories
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- Sports: Tensions flared after the Asia Cup, with Pakistan captain caught on camera throwing away a cheque following defeat to India.
Takeaway
With prices above $3,870 per ounce, gold has reaffirmed its position as a safe-haven asset of choice during political and economic uncertainty. Analysts believe that unless the US fiscal standoff resolves quickly and the labour market stabilises, gold’s momentum could continue in the near term.