Gold Hits Record, Dollar Drops on Shutdown Fears: Markets Wrap

(Bloomberg) — Gold hit a new record and dollar held its losses as concerns mounted over a US government shutdown.

The precious metal, a traditional safe-haven asset, climbed above $3,839 an ounce. A gauge of the dollar was little changed after falling for two consecutive days. Equity-index futures for US dipped 0.1% while Asian shares were flat. Treasuries were little changed Tuesday after gaining across the curve in the prior session.

The likelihood of a US government shutdown increased after Vice President JD Vance said he believed it was likely. President Donald Trump met with top congressional leaders in a last-ditch effort to prevent a shutdown from occurring before an Oct. 1 deadline, but the meeting concluded without resolving Democrats’ demands.

Investors remain concerned that a shutdown could hinder some crucial data releases that they require to discern how the US economy is doing. That includes Friday’s nonfarm payrolls report, which would offer details on how the labor market is holding up and help the Federal Reserve decide on the path for rate cuts.

“Given the importance of the job market to the Fed’s rate-cutting decisions, risk that the September unemployment report could be delayed could add to the market’s anxiety over the direction of policy,” said Kathy Jones, chief fixed income strategist at Charles Schwab & Co.

Emerging-market assets climbed to start the week as the looming risk of a shutdown weighed on the dollar. The US Treasury 10-year yield declined to 4.14% — shutdowns are typically associated with gains for bonds because of their potential to restrain the economy.

A gauge of US-listed tech shares from China surged 2% ahead of the week-long holiday in the country starting Wednesday. Investors put money into exchange-traded funds that buy Chinese stocks last week, joining a wave of optimism around artificial intelligence that has fueled a $2.7 trillion onshore equity rally this year.

In Asian developments, China announced it’s offering 500 billion yuan ($70 billion) worth of capital to spur investment, in a long-anticipated move to boost growth after provinces likely diverted funds from projects as they borrowed more to restructure hidden debt.

Longer term, the official Xinhua News Agency said on Monday that the ruling Communist Party will convene a closed-door meeting in October to review development plans for the next five years.

Meanwhile, Australia’s central bank will meet on Tuesday and is expected to keep interest rates unchanged.

In the US, uncertainty around trade policies is persisting as Trump said he would levy new tariffs to boost the domestic film and furniture industries through a pair of sweeping — yet confusing — plans. Emma Wall, chief investment strategist at Hargreaves Lansdown, wrote that investors should be mindful that the inflationary impact of tariffs is not properly seen in numbers.

“Further tax hikes — such as the 100% pharmaceuticals levy announced last week — are likely to add pricing pressures,” she said.

On Monday, investors also heard from a handful of Fed speakers. St. Louis Fed President Alberto Musalem said that while he’s open to further rate cuts, policymakers should move carefully, since inflation is still running above target.

New York Fed President John Williams, on the other hand, said inflation risks have come down, but those for employment have moved up. He didn’t indicate whether he might support another rate cut when policymakers next gather in late October.

Apart from Friday’s jobs report, there’s also the JOLTs report releasing on Tuesday that will offer a picture on job openings while Wednesday’s data will shed light on company hirings. Strategists said the recent negative revisions and downtrend in jobs numbers will raise the stakes for Friday’s release.

In geopolitical developments, Trump and Israeli Prime Minister Benjamin Netanyahu said they had agreed to a 20-point plan designed to end the war in Gaza, though the prospects for peace remained unclear without the direct involvement of Hamas.

In commodities, oil pushed lower for a second session as the market weighed a looming glut and the possibility for an end to hostilities in Gaza, which could siphon some of the war premium out of prices.

Corporate News:

Zijin Gold International Co. will start trading in Hong Kong on Tuesday after the international unit of China’s biggest miner raised $3.2 billion in the world’s largest initial public offering since May. Electronic Arts Inc. agreed to sell itself in the largest leveraged buyout on record to a group of investors that includes a firm managed by Trump’s son-in-law Jared Kushner and Saudi Arabia’s sovereign wealth fund. Alphabet Inc.’s Google agreed to pay $24.5 million to resolve Trump’s claims that being banished from his YouTube channel after the Jan. 6, 2021, riot at the US Capitol was illegal censorship, according to a court filing. Huawei Technologies Co. is preparing to sharply ramp up production of its most advanced artificial intelligence chips over the next year. Some of the main moves in markets:

Stocks

S&P 500 futures were little changed as of 9:21 a.m. Tokyo time Hang Seng futures rose 0.1% Japan’s Topix fell 0.2% Australia’s S&P/ASX 200 rose 0.1% Euro Stoxx 50 futures fell 0.1% Currencies

The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1730 The Japanese yen was little changed at 148.58 per dollar The offshore yuan was little changed at 7.1260 per dollar The Australian dollar was little changed at $0.6578 Cryptocurrencies

Bitcoin fell 0.1% to $114,173.59 Ether fell 0.6% to $4,203.77 Bonds

The yield on 10-year Treasuries was little changed at 4.14% Japan’s 10-year yield declined two basis points to 1.635% Australia’s 10-year yield declined two basis points to 4.31% Commodities

West Texas Intermediate crude fell 0.6% to $63.07 a barrel Spot gold rose 0.1% to $3,838.08 an ounce This story was produced with the assistance of Bloomberg Automation.

–With assistance from Rheaa Rao.

©2025 Bloomberg L.P.