Gold soared to yet another record on Tuesday, supported by heightened prospects of future US rate cuts, with investors expecting Federal Reserve Chair Jerome Powell’s speech later in the day for fresh policy indications.
After rising by over 1% to a new all-time high of $3,790.64 per ounce, spot gold fell down below $3,770. In the meanwhile, US gold futures rose 0.9% to $3809.1 an ounce, breaking beyond the $3,800 mark.
Riding the wave of the Federal Reserve’s first rate drop of the year and anticipation of more to come, bullion has risen more than 2% over the last week, hitting a new high in almost every trading session.
Investors anticipate two further 25-basis point cuts, one in October and one in December, with a 90% and 73% chance, respectively, according to the CME FedWatch tool.
The central bank was misjudging how tight it had set monetary policy, according to new Fed Governor Stephen Miran, who earlier this week urged for rapid rate reduction that would jeopardize the labor market.
Ross Norman, an independent analyst, told Reuters that Iran’s dovish stance “definitely heightens the anticipation of additional rate reduction since it appears the US administration is determined to pursue this, and this is a gold-positive conclusion.”
The yellow metal has increased by around 44% in 2025, with almost one-third of those gains occurring in the month before to last week’s 25 basis point rate decrease. Intense institutional investor purchasing with a spike in demand for safe havens also contributed to this run. The biggest gold-backed exchange-traded fund in the world, SPDR Gold Trust, said that its holdings increased by 0.6% to 1,000.57 tons, which is more than three years high.
Many observers believe that gold’s record-breaking rise is still ongoing. Goldman Sachs is forecasting that gold will reach the $4,000-an-ounce milestone by mid-2026, while UBS just raised its year-end price projection to $3,800 an ounce.
According to Jefferies’ global head of equities strategy Christopher Wood, gold still has a 75% potential upside, reaching $6,600 in the next months.