Gold prices hit all-time high amid US political turmoil — Bloomberg
Photo: Gold price approaches $4,000 per ounce (Getty Images)
The price of gold rose to a historic high, approaching the $4,000 per ounce mark, amid fears of a prolonged shutdown of the US federal government, Bloomberg reports.
Record growth in price of gold
Gold prices rose to a record high of nearly $4,000 per ounce as expectations of lower interest rates in the US and the risk of a prolonged government shutdown increased investor interest in safe-haven assets, according to Bloomberg.
At the beginning of the week, the price of gold rose 1.5% to $3,945 per ounce, continuing its seven-week rise. Since the beginning of the year, prices have already risen by about 50%, and gold-backed exchange-traded funds have shown their largest increase in more than three years.
Uncertainty in US is driving investors
The possible shutdown of the US government has led to delays in the revealing of key economic data, which has only increased uncertainty.
As a result, traders are relying on private reports, and the Federal Reserve is facing difficulties in assessing the real situation.
Investors expect a quarter-point rate cut, which traditionally supports demand for gold as a non-interest-bearing asset.
Central banks and investors fuel growth
The rise in the price of gold has also been supported by central banks, which continue to diversify their reserves away from the US dollar. Economic and geopolitical uncertainty, particularly related to the Donald Trump administration, as well as the Fed's monetary policy easing, have stimulated interest in safe-haven assets such as gold, silver, and bitcoin.
As noted by analyst Phillip Nova Pte, the influx of funds into gold funds was impressive and demonstrates how deeply ingrained the buy-the-dip mentality is among investors.
As of 8:58 a.m. in London, the price of gold rose 1.4% to $3,943.89 per ounce. The Bloomberg spot dollar index rose 0.5%, while silver, platinum, and palladium prices also showed gains.
A Pepperstone Group analyst noted that the Fed's rate cuts amid a weakening labor market are supporting gold, but at the same time, a short-term pullback is possible, which will be a healthy phase within a long-term uptrend.
In April 2025, gold rose to $3,500 per ounce for the first time in history.
The sharp jump in prices was triggered by fears that President Donald Trump might fire Federal Reserve Chairman Jerome Powell, leading to an outflow of funds from US stocks, bonds, and the dollar.
On September 2, gold prices rose sharply again, reaching a historic high of $3,508.70, and the next day, the price of the metal exceeded $3,578 per ounce, setting a new record.
