Price of gold reaches record amid fears of US government shutdown

New record for gold, above $3850 Keystone-SDA

The price of an ounce of gold continued to rise on Tuesday morning. After reaching $3,850 on Monday night, it rose to $3,870 on Tuesday, buoyed by the risk of budgetary paralysis in the United States, the so-called “shutdown”.

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At around 7:35am on the last day of September, the price of the precious metal was up 0.9% at $3,867.55 an ounce. It is heading for “its biggest monthly rise in fourteen years, as investors rush to safe havens amid growing concerns over the threat of a US government shutdown and expectations of a further rate cut by the Federal Reserve”, commented Trading Economics.

If no budget, even a temporary one, is adopted by Tuesday in Washington, the US will experience another shutdown, which could delay the publication of several indicators as government agencies shut down. The market is awaiting the monthly ADP report on private sector job creation for September, due on Wednesday.

The US unemployment rate for September will also be published on Friday. “Remember that this is the indicator that Jerome Powell (the Fed boss) considers to be decisive for the immediate path of US interest rates,” stressed John Plassard for Cité Gestion in a commentary.

The ounce is “well above the overbought threshold, but this has not deterred those looking for the ultimate security offered by gold, combined with strong momentum”, pointed out Ipek Ozkardeskaya of Swissquote. The same is true of silver, which is approaching $50 an ounce, a level not reached since 2011.

Adapted from French by DeepL/jdp

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