Gold Surges Past $4,000/Oz: What Investors and Businesses Should Know Amid Dollar Dip and US Shutdown Uncertainty
Gold prices surged past the crucial $4,000 per ounce mark on Thursday, driven by a softer US dollar and ongoing concerns over the extended US government shutdown, which is raising uncertainties about the economic outlook.
By 0914 GMT, spot gold had increased by 0.7% to reach $4,011.79 per ounce. Similarly, US gold futures for December delivery rose 0.7% to $4,021.20.
UBS analyst Giovanni Staunovo noted that “Supreme Court skepticism regarding tariffs and the slightly weaker dollar are likely supporting gold.” He added that while near-term prices might consolidate, anticipated Federal Reserve rate cuts could propel gold prices to $4,200 per ounce by year-end.
The dollar index fell 0.2% after hitting a four-month peak the previous day, enhancing gold’s appeal for investors holding other currencies.
In a related development, US Supreme Court justices expressed doubts about the legality of former President Donald Trump’s broad tariffs in a case with significant global trade implications.
On the economic front, the latest ADP report revealed that private employers in the US added 42,000 jobs in October, surpassing expectations of a 28,000 increase. This indicates resilience in the labor market and may dampen hopes for additional interest rate cuts.
The ongoing congressional deadlock has triggered the longest US government shutdown on record, compelling investors and policymakers to rely more heavily on private-sector data. Last week, the Federal Reserve cut interest rates, but Chair Jerome Powell indicated this might be the final rate reduction for 2025.
Market sentiment now assigns a 63% probability of another Fed rate cut in December, a notable decrease from over 90% a week earlier. Gold, which does not yield interest, typically benefits from lower interest rate environments.
Elsewhere in the precious metals market, spot silver climbed 1.4% to $48.74 per ounce, platinum gained 0.4% to $1,567.01, and palladium increased by 1.1% to $1,434.22.
— Reuters
Special Analysis by Omanet | Navigate Oman’s Market
The surge of gold past $4,000 per ounce amid a weakening dollar and US economic uncertainties signals heightened investor caution and a potential shift toward safe-haven assets. For businesses in Oman, this presents an opportunity to hedge against currency risks and inflation by considering gold-related investments. Smart investors should closely monitor Federal Reserve policies and geopolitical developments, as further rate cuts could elevate precious metal prices, amplifying both opportunity and risk in the regional market.
