Gold prices briefly touched an all-time high on Tuesday as mounting bets on US interest rate cuts and uncertainty over President Donald Trump’s trade tariffs drove investors into bullion.
Spot gold (XAU/USD) traded at $3,481.53 an ounce by late morning, up from $3,476.94, after hitting a record $3,501.59 earlier in the session, surpassing April’s $3,500.10 peak.
Gold’s rise has been supported not only by rate cut speculation but also by strong central-bank and institutional demand. Foreign central banks have steadily reduced their US Treasury holdings for more than a decade, with the shift into gold accelerating this year amid US debt concerns, credit downgrades, geopolitical risks and trade tensions.
The latest leg higher came after a US appeals court ruled many Trump-era tariffs illegal, although they remain in place until mid-October pending a Supreme Court appeal. Trump blasted the decision and vowed to fight it, adding to market unease over the economic fallout of his trade policies.
Markets are now pricing an 85% chance of a 25 basis point Fed cut in September, CME FedWatch showed. While the PCE index released last week pointed to sticky inflation above target, Fed Chair Jerome Powell said the central bank was weighing the case for a reduction, though he stopped short of committing.
Focus will now shift to US jobs data later this week. A soft non-farm payrolls report would likely cement expectations of a September cut, while a stronger reading could temper them.