SEOUL, September 03 (AJP) - Gold prices surged to fresh records on Tuesday (local time), fueled by mounting expectations of U.S. Federal Reserve interest rate cuts and heightened geopolitical uncertainty.
Spot gold climbed to $3,530 an ounce on Sept. 2, topping the previous peak of $3,500 set in April. Futures contracts on the Commodity Exchange rose even higher, touching about $3,600 an ounce during the session.
The rally comes as investors increasingly bet that the Fed will lower borrowing costs when policymakers meet later this month. At the Jackson Hole economic symposium in August, Jerome Powell, the Fed chair, signaled that officials were prepared to act if evidence of slowing growth continued to build.
The Federal Open Market Committee is scheduled to convene Sept. 16-17. A reduction in rates would likely weaken the dollar and bolster demand for gold, which is widely viewed as a hedge against inflation and economic instability.
Traders are now turning their attention to the U.S. jobs report for August, due Friday. A further cooling in the labor market, after recent signs of softness, could strengthen the case for a rate cut and push gold even higher.
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