On Monday, gold broke another all-time high — the price exceeded $3,800 for the first time in history.
At its peak, the price reached $3,833, then rolled back slightly. The spot price settled at $3,829 (+1.9%), and December futures ended the day at $3,855.20, gaining 1.2%, according to CNBC.
At the same time, the US dollar index fell by 0.2%, making gold cheaper in dollar terms for foreign buyers.
The sharp price increase is linked to expectations of Fed rate cuts, political instability in Washington, and rising geopolitical tensions.
According to David Meger, head of metals trading at High Ridge Futures, gold’s rise is fueled by demand for safe-haven assets amid a possible US government shutdown.
“The dollar’s decline also supports the entire precious metals sector,” he added.
Meanwhile, Donald Trump held a meeting with Congressional leaders to seek an extension of government funding. If no compromise is found, the shutdown will begin as early as Wednesday. The political deadlock became another factor boosting the rally — since the start of the year, gold has already gained over 43%.
Fed rates and geopolitics continue to drive the precious metals market
On Friday, the Personal Consumption Expenditures (PCE) index was released — it matched forecasts, calming markets and strengthening expectations that the Fed has room to cut rates. Traders are already pricing in two possible moves — in October and December. David Meger noted:
“PCE did not become an obstacle to one or two additional rate cuts. This continues to benefit both gold and silver.”
On the international stage, interest in safe-haven assets was also boosted by the conflict in Ukraine — Russia’s Ministry of Defense reported that its forces had taken the village of Shandrygolovo in the Donetsk region. This was another alarming signal of escalation from Vladimir Putin.
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In the corporate sector, there is news of its own. The world’s largest gold producer Newmont announced that CEO Tom Palmer will leave the company at the end of the year, ending more than a decade of work. On the same day, competitor Barrick confirmed that its head Mark Bristow also resigned.
Against this backdrop, silver jumped by 1.9% to $46.85 — the highest in the past 14 years. Platinum rose 1.5% to $1,592.65, a 12-year high. The only exception was palladium: it fell by 1.1% to $1,255.61.
AI company stocks rise, Wall Street stabilizes
While attention is focused on gold, US stocks also recovered some losses. S&P 500 added 0.26% and closed at 6,661.21. Nasdaq rose by 0.48% to 22,591.15.
Dow Jones added 68.78 points, that’s 0.15%, final mark 46,316.07. A week ago, the picture was weaker: S&P showed its worst result since early August, Nasdaq as well, and Dow went negative for the first time in three weeks.
The market was supported by AI-related stocks. Nvidia gained about 2% amid discussions of its projects’ energy consumption with OpenAI. Advanced Micro Devices rose by more than 1%, Micron Technology climbed by about 4%.
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The bet on semiconductors remains, even despite questions about the industry’s growth rate. There was movement outside the tech sector as well. Electronic Arts shares rose by 4.5% after announcing plans to delist in a $55 billion deal. This fits into the activation of the M&A market.
According to Goldman Sachs, the volume of mergers and acquisitions in the US since the beginning of the year exceeded $1 trillion. That’s almost a third more than in the same period last year.
Buyers returned on Monday, and the markets stabilized. However, the focus remains on gold, which is seen as a key safe-haven asset amid budget disputes in Washington, Fed policy, and nervous geopolitics.
