Gold prices reached a new historic high on Wednesday. Increased safe haven demand due to the US government shutdown and expectations of a Fed interest rate cut this month made the precious metal more attractive to investors.
Gold rose 0.9% to $3,891.96 per ounce, and reached an all-time high of $3,895.09 during the day. December US gold futures contracts also rose 1.2% to $3,918.60. The dollar index fell 0.2% during this period, reaching its lowest level in a week. This made dollar-denominated gold cheaper for foreign investors. Analysts note that the government shutdown could suppress economic output and that key data, particularly the non-farm payrolls report, may be delayed. Investors are pricing in a 95% probability of a Fed rate cut this month. Such a step means extra support for gold, which does not yield interest. Other precious metals also saw gains: Silver rose 1.5% to $47.39, reaching a 14-year high. Platinum rose 0.6% to $1,583.75, and palladium rose 0.5% to $1,263.44.
