Gold surged to a new record high on Monday, as investors positioned themselves ahead of a widely anticipated easing of U.S. Federal Reserve monetary policy and looked for signals on the likelihood of further rate cuts later this year. Bullion traded above $3,682 an ounce, extending gains for a fourth consecutive week, amid expectations of a quarter-point rate cut from the Fed in response to signs of a softening labor market. Swaps markets also indicate a high probability of at least one additional rate reduction before year-end, with some pricing in a potential third cut.
The market’s anticipation of looser policy has driven U.S. Treasury yields to the lowest levels in months and weakened the dollar, boosting the appeal of gold as a non-yielding safe-haven asset. A weaker dollar also makes the metal more affordable for investors holding other currencies. Traders and analysts are closely watching whether the Fed will act in line with these market expectations, as any divergence could shake gold prices in the near term.
“Macroeconomic numbers are likely to take over from tariff-related headlines,” wrote Daniel Hynes and Soni Kumari of ANZ Group Holdings in a note to investors, emphasizing that economic indicators will likely be the primary driver of markets this week.
Gold has rallied roughly 40% so far in 2025, breaking out of a prolonged period of range-bound trading to surpass an inflation-adjusted record. Persistent geopolitical uncertainty, ongoing trade tensions under President Donald Trump’s administration, and consistent central bank purchases have all contributed to the rally.
Trump’s recent unconventional pressure on the Fed, including his attempt to remove Governor Lisa Cook, has further fueled gold’s ascent. Analysts at Goldman Sachs Group Inc. have suggested that, if just 1% of the privately held U.S. Treasury market were to flow into bullion, gold could approach $5,000 an ounce, highlighting the potential upside in the metal amid policy uncertainty.
In addition to gold, other precious metals saw mixed movements on Monday: silver and platinum climbed, while palladium declined. Copper prices gained 1% on the London Metal Exchange, reaching $ per ton. Meanwhile, the Bloomberg Dollar Spot Index slipped, reflecting broad weakness in the dollar.
Internationally, Thai authorities are considering new taxes on gold bought and sold through various online channels and settled in baht. The move aims to curb the currency’s rapid appreciation, which has been partly fueled by bullion-related dollar inflows, and to reduce domestic gold ownership costs. Officials hope the measure will protect exports and tourism while stabilizing the baht, according to sources familiar with the discussions.
With the Fed meeting imminent and macroeconomic indicators poised to influence market sentiment, gold investors are closely monitoring both central bank actions and geopolitical developments. The combination of rate-cut expectations, central bank buying, and broader uncertainty continues to drive momentum in the precious metals market, keeping gold at the forefront of investors’ focus as a store of value in a volatile environment.
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