Gold prices soared to fresh records in Asian trade Monday, lifted by mounting concerns over a potential U.S. government shutdown and rising expectations for Federal Reserve rate cuts.
Spot gold climbed to an unprecedented $3,812 per ounce, while December futures peaked at $3,839.05/oz. The rally extended a broader surge across precious metals, supported by a softer dollar after in-line inflation data kept markets betting on further monetary easing.
Silver and platinum also posted standout gains, surging to more than decade highs. Traders said the combination of political gridlock in Washington, inflation uncertainty, and a weaker greenback has amplified safe-haven demand for bullion.
Shutdown Threat Sparks Investor Caution
Investor attention turned sharply to Washington as Congress faced a September 30 deadline to fund federal operations. Without a resolution, the U.S. risks entering its first government shutdown since 2018–19, a 35-day standoff that the Congressional Budget Office estimated shaved $11 billion off GDP.
- Deadline: Funding expires midnight Sept. 30
- Stalemate: Republicans seek a short-term bill; Democrats demand reversal of healthcare and Medicaid cuts
- Talks: Bipartisan leaders to meet President Donald Trump Monday for mediation
A shutdown could disrupt the release of key nonfarm payrolls data later this week and weigh on near-term economic activity if prolonged. Analysts warn that the political uncertainty is magnifying volatility across currency and commodities markets.
Silver, Platinum Lead Metal Rally
While gold dominated headlines, silver and platinum staged even sharper rallies.
- Silver: Jumped 2% to $47.1765/oz, a 14-year high
- Platinum: Gained 3.2% to $1,626.06/oz, its strongest level in 12 years
The metals rally was further fueled by expectations of monetary easing. Data released Friday showed the PCE price index—the Fed’s preferred inflation gauge—remained sticky, but markets still anticipate cuts ahead.
According to CME FedWatch:
- 91.9% chance of a 25 bps cut in October
- 64.2% chance of another cut in December
Weaker interest rate outlooks tend to bolster non-yielding assets like gold and silver by lowering their opportunity cost. Copper also advanced, with LME benchmark futures up 0.6% to $10,276.45/ton, while COMEX copper rose 1.3% to $4.8065/lb.