Wed Sep 25 04:34:58 UTC 2024: ## Gold Hits Record High on Lower Interest Rate Bets, Dollar Weakness

**New York, NY** – Gold prices surged to a record high on Wednesday, propelled by continued optimism over lower U.S. interest rates and a weakening dollar. The precious metal gained 0.3% to reach $2,670.52 an ounce, while December futures climbed to $2,694.75 an ounce.

The Federal Reserve’s decision to cut interest rates last week, signaling the start of an easing cycle, has been a key driver for gold. Lower interest rates make it less attractive to hold bonds and more appealing to invest in non-yielding assets like gold.

The dollar, meanwhile, plummeted to a 14-month low following the Fed’s move, further boosting gold’s appeal. Investors are anticipating further interest rate cuts in the coming months, which could further weaken the dollar and fuel gold’s rally.

The Fed’s future plans will be scrutinized this week, with several officials scheduled to speak on interest rates. The key event will be Chair Jerome Powell’s address on Thursday. Friday’s release of the PCE price index, the Fed’s preferred inflation gauge, will also be closely watched.

Analysts at Citi expect the Fed to cut rates by a total of 125 basis points following last week’s 50 bps reduction, while Goldman Sachs predicts 25 bps cuts at every meeting between November and June 2025.

Gold’s safe haven appeal was also boosted by heightened tensions in the Middle East, as Israel continues its offensive against Hamas and Hezbollah.

Other precious metals, while still sitting on strong recent gains, saw slight declines. Platinum futures dipped 0.1% to $988.80 an ounce, while silver futures fell 0.5% to $32.267 an ounce.

Copper prices, after reaching two-month highs on Tuesday, saw a slight dip. The red metal benefited from optimism over more stimulus measures in China, the world’s top importer, which are expected to boost demand for copper. However, analysts believe Beijing needs to implement further measures, particularly on the fiscal side, to support growth.

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