Gold hits an all-time high, surpassing $3,600 per ounce

The price of gold hit a new all-time high on Monday, surpassing $1,436 per ounce, driven by growing expectations of an interest rate cut by the U.S. Federal Reserve (Fed) following the release of weak employment data.

Spot gold rose 0.71%, trading at $1,361.20 per ounce at 08:41 GMT, after hitting a record high of $1,361.64 during the session. Meanwhile, U.S. gold futures for December delivery remained stable at US$1,653.10.

Gold accumulates strong advance in 2025

So far this year, gold has risen by 37.1%, following a 27.1% gain in 2024. This rally has been driven by the weak dollar, massive central bank purchases, the monetary policy environment, and geopolitical and economic uncertainty.

The upward trend in the precious metal was bolstered by news that U.S. job growth weakened sharply in August, pushing the unemployment rate to 4.31%, its highest level in nearly four years. This bolstered expectations that the Fed would cut rates at its next meeting.

Monetary policy expectations

According to CME’s FedWatch tool, traders assign a 90.1% probability to a 25-basis-point rate cut this month. A rate cut tends to benefit gold by lowering the opportunity cost of holding non-interest-bearing bullion, while weakening the dollar, making the purchase of the metal more attractive in other currencies.

In parallel, the profitability of 10-year U.S. Treasury bonds approached its lowest level in five months, which reinforced gold's appeal as a safe-haven asset.

Other precious metals and a look at inflation

The rally in gold also boosted other precious metals. Spot silver rose 0.31% to $41.08 per ounce. Platinum advanced 1.61% to $1,394.90, while palladium gained 1.31% to $1,124.24.

The market is now focusing its attention on the US inflation report, which will be released this Thursday and could offer greater clarity on the magnitude of the interest rate cut anticipated by the Federal Reserve.