Gold jumps to record above $2,460 an ounce on hopes Fed will soon cut rates

Gold jumped to a grounds Tuesday arsenic rising expectations of a September involvement complaint chopped bolstered request for bullion.

Gold futures settled up 1.6% to an all-time closing precocious of $2,467.8 per ounce, aft besides hitting a caller intraday grounds precocious of $2,474.5 during the session. Gold futures prices person climbed much than 19% this year.

Spot gold jumped 1.9% to $2,468.68 an ounce during the session. LSEG information shows that's an all-time precocious going backmost to 1968, without adjusting for inflation.

Gold prices deed grounds highs earlier this twelvemonth earlier pulling backmost arsenic the imaginable of higher-for-longer involvement rates dampened capitalist enthusiasm for the precious metal. But involvement successful the plus has grown aft June's softer ostentation data and immoderate precocious dovish comments from Federal Reserve Chair Jerome Powell combined to rise the likelihood of complaint cuts coming this year. Markets are pricing successful 100% odds of a complaint chopped successful September now, according to futures trading tracked by the CME FedWatch tool.

Gold futures, 5 years

A weakening dollar has besides supported request for bullion. On Tuesday, the U.S. greenback rebounded aft falling to a five-week low.

"Interest to 'buy-the-dip' remained prevalent among investors amid beardown sentiment towards gold, which is apt wherefore the market was speedy to rally connected brushed U.S. information prints and dovish Fed expectations," UBS strategist Joni Teves said successful a enactment connected Friday.

"With the market sitting conscionable supra the intelligence $2400 level, we deliberation risks are skewed to the upside," Teves continued. "We deliberation positioning remains thin and there's abstraction for investors to physique golden exposure."

Gold rallied to grounds highs successful the archetypal fractional of 2024 connected the backmost of a multiyear spike successful request from cardinal banks astir the world, arsenic mounting planetary geopolitical risks boosted involvement successful the harmless haven asset. According to UBS, cardinal slope buying of bullion is the highest it's been since the precocious 1960s.

"With immoderate cardinal banks present questioning the information of holding USD- and EUR-denominated assets (following the fiscal and indebtedness crises and much precocious the warfare successful Ukraine), galore are choosing to alternatively capable their reserves with gold," work a enactment past period from UBS.

Gold mining stocks besides precocious connected Tuesday. The VanEck Gold Miners ETF gained 3.4%, posting a 5th winning time successful six. The U.S.-listed shares of Harmony Gold and Gold Fields roseate 16.1% and 6.3%, respectively.