Gold hits record $3,530 driven by speculated cuts in U.S interest rates

Gold prices soared to a new record on Tuesday, buoyed by mounting expectations of US interest rate cuts and uncertainty over the Federal Reserve’s monetary outlook.

Spot gold rose 1.5 percent to an unprecedented $3,530 per ounce, surpassing its previous peak of $3,500.05 set in late April, according to Mining.com.

Gold futures in New York also reached fresh highs, trading at around $3,590.40 per ounce. The rally was fuelled by speculation that the Fed could cut interest rates for the first time in nine months.

Fed Chair Jerome Powell recently signalled cautious openness to monetary easing, boosting safe-haven demand.

“Investors adding to gold allocations, especially as Fed rate cuts loom, are pushing prices higher,” said UBS strategist Joni Teves.

“Our base case is that gold continues to make new highs over the coming quarters,” Teves said.

Teves pointed to a softer economic outlook, lower interest rates, and persistent geopolitical risks as factors strengthening gold’s role as a portfolio diversifier.

Suki Cooper, an analyst at Standard Chartered Bank, said the market was also entering a seasonally strong period for consumption.

“We continue to expect further upside risk for gold prices and forecast gold to average $3,500/oz in Q3 2025 and $3,700/oz in Q4 2025,” Cooper said.

Gold has more than doubled in the past three years as investors sought protection against global economic and political uncertainty.

In 2025 alone, bullion has gained over 30 percent, partly fuelled by heightened trade tensions under President Donald Trump’s tariff policies.

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