A worker polishing gold bullion. — AFP
Gold prices moved past $4,100 to a record high on Tuesday on increased prospects of U.S. Federal Reserve rate cuts, while resurgent U.S.-China trade woes boosted safe-haven bets, including those for silver, which also scaled an all-time peak.
Spot gold rose 0.2% to $4,117.72 per ounce at 0716 GMT, after hitting an all-time high of $4,179.48 earlier in the session.
U.S. gold futures for December delivery was flat at $4,133.80.
Gold has surged 57% year-to-date, breaking the crucial $4,100 threshold for the first time on Monday.
Spot silver fell 0.5% to $52.07, after hitting a record high of $53.60 earlier in the session, buoyed by the same factors supporting gold and spot market tightness.
Bullion has been bolstered by geopolitical and economic uncertainties, rate cut expectations, strong central bank buying and robust exchange-traded fund inflows.
Bank of America and Societe Generale now expect gold to hit $5,000 by 2026, while Standard Chartered raised its price forecast for next year to $4,488.
"The trade tensions are not the primary driver for the rally (today) as increasing bets for the Fed to continue its interest rate cut trajectory, reducing long-term funding costs eventually lowering the opportunity cost are (also supporting gold)," OANDA senior market analyst Kelvin Wong said.
Philadelphia Fed chief Anna Paulson said that rising risks to the labour market have bolstered the case for further U.S. rate cuts.
Investors are awaiting Fed Chair Jerome Powell's speech at the NABE annual meeting on Tuesday for further cues into the central bank's policy path.
Traders expect a 99% and 94% chance of a 25-basis-point cut in October and December, respectively. Non-yielding gold tends to do well in low-interest-rate environments.
Elsewhere, U.S. President Donald Trump is scheduled to meet his Chinese counterpart Xi Jinping in South Korea later this month, U.S. Treasury Secretary Scott Bessent said.
Tensions escalated as China unveiled expanded rare-earth export controls on Thursday, prompting Trump to threaten an additional 100% tariff on Chinese goods and planned export controls on critical U.S.-made software, effective November 1.
Platinum rose 0.4% to $1,652.40 and palladium fell 0.7% to $1,465.0. - Reuters
