Gold races to all-time high above US$3,500 on US rate cut prospects

Traders are currently pricing in a 90% chance of a 25-basis-point Fed rate cut on Sept 17, according to the CME FedWatch tool. Non-yielding gold typically performs well in a low-interest-rate environment.

Long regarded as a dependable hedge against geopolitical and economic turmoil, gold has rallied to multiple record highs in 2025, drawing support from ongoing central bank buying amid a move away from the US dollar, strong safe-haven demand in light of geopolitical and trade uncertainty, plus broad dollar weakness, analysts say.

Spot gold prices rose 27% in 2024, and broke the US$3,000 per ounce level for the first time in March this year as uncertainty around US President Donald Trump’s trade policies sent investors flocking to the safe-haven asset.

Meanwhile, Trump has criticised the Fed and its chair, Jerome Powell, for months for not lowering interest rates, and recently took aim at Powell over a costly renovation of the bank’s Washington headquarters.