Precious metals markets saw strong gains in Monday’s trading, led by gold, which surged to a new historic high above $3,800 per ounce, supported by increased safe-haven demand amid rising concerns over a potential U.S. government shutdown, alongside persistent expectations of interest rate cuts in the coming months.
Spot gold hit a peak of $3,812, while December futures reached $3,839, reflecting strong bullish momentum. The rally was not limited to gold; silver climbed to a 14-year high above $47 per ounce, while platinum advanced past $1,626, marking its highest level in over 12 years.
These moves were underpinned by a weaker U.S. dollar following the release of inflation data (PCE) that came in line with expectations, reinforcing market conviction that the Federal Reserve is leaning toward rate cuts in its October and December meetings. Market indicators currently show a more than 90% probability of a 25-basis-point cut in October, with strong odds for an additional cut in December.
On the political front, uncertainty remains high as U.S. government funding is set to expire at midnight on September 30, with no clear agreement between parties on passing a funding bill. Republicans are pushing for a short-term extension until November, while Democrats are demanding the reversal of recent cuts to healthcare and Medicaid before approving any new packages. Congressional leaders are scheduled to meet President Donald Trump in an attempt to reach a compromise.
Failure to secure a deal could trigger a new government shutdown, which may delay the release of nonfarm payrolls data and negatively impact economic activity if prolonged. Beyond precious metals, industrial metals also benefited from dollar weakness, with copper rising to $10,276 per ton on the London Metal Exchange and $4.80 per pound on COMEX.
Overall, markets are currently pricing in a mix of political and economic risks alongside expectations of rate cuts, placing gold and other precious metals in a strong position to extend their gains—though volatility is likely, driven by Washington’s negotiations and key U.S. economic data due later this week.
Stay informed about global markets through our previous analyses. and Now, you can also benefit from LDN company services via the LDN Global Markets trading platform.
