Softer dollar and rate cut bets helps gold speed past $3,800
Mon Sep 29 2025
Gold surged above the key $3,800/oz level for the first time on Monday, supported by a weaker dollar and the growing expectation that the Federal Reserve will cut interest rates further this year.
Spot gold jumped 1.1% to $3,801.88/oz by 4.35am GMT. US gold futures for December delivery rose 0.6% to $3,831.90.
The dollar index eased 0.2% against its rivals, making greenback-priced bullion less expensive for overseas buyers.
The US commerce department said on Friday that its personal consumption expenditures (PCE) price index rose 0.3% in August, versus a 0.2% increase in July, matching the estimate of economists polled by Reuters.
“That benign inflation print in the US has given the markets reason to believe further Fed cuts are coming in October and December,” said Capital.com analyst Kyle Rodda.
“Sentiment is very bullish and we are on track to retest another record high this week. The gold market is positioned quite long at the moment and that may be pointed to as being a reason to be cautious about future upside.”
Traders are currently pricing in a 90% chance of a Fed rate cut in October, with around a 65% probability of another easing in December, according to the CME FedWatch Tool.
Safe-haven bullion thrives in a low interest rate environment and in times of geopolitical and economic uncertainty.
Share markets got off to a cautious start in Asia on Monday as investors braced for a possible shutdown of the US government.
Investors now await US data on job openings, private payrolls, the ISM manufacturing PMI and the nonfarm payrolls report for further clues on the economy's health.
SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 0.89% to 1,005.72 metric tonnes on Friday from 996.85 tons on Thursday.
Elsewhere, spot silver rose 2.4% to $47.08/oz, platinum climbed 3.4% to $1,622.04 and palladium gained 2.2% to $1,297.67.