Gold rose for a fifth straight session on Thursday to hit its highest in more than three weeks, buoyed by expectation that the U.S. government reopening will restart the flow of economic data and boost bets for further interest rate cuts.
Spot gold was up 0.4% at $4,215.87 per ounce, as of 0407 GMT, hitting its highest since October 21. U.S. gold futures for December delivery rose 0.2% to $4,219.90 per ounce.
“The prospect of weak economic data following the U.S. government shutdown helped push gold higher. This is likely to be supported by ongoing demand from central banks,” analysts at ANZ said in a note.
“Favourable policy measures, economic uncertainty and limited investment alternatives will support both retail and strategic investment demand for gold.”
U.S. President Donald Trump on Wednesday signed legislation ending the longest government shutdown in U.S. history. The shutdown, which began on October 1, has halted the release of critical economic data, including payroll and inflation reports.
Economists said the U.S. Labor Department’s statistical agency should prioritise the production of November employment and inflation reports to ensure Federal Reserve officials have up-to-date information at their December policy meeting.
The Fed will again lower its key interest rate by 25 basis points next month to underpin a weakening labour market, according to 80% of economists polled by Reuters, up slightly from a poll taken last month.
Non-yielding gold tends to do well in a low-interest-rate environment and during economic uncertainties.
Gold prices have surged 60% year-to-date, hitting an all-time high of $4,381.21 on October 20, buoyed by geopolitical and trade tensions and Fed rate-cut hopes.
Meanwhile, the yen dipped to a record low versus the euro and wallowed near a nine-month trough against the dollar after Japan’s new prime minister said she wanted the central bank to go slow on interest rate hikes. [USD/]
Elsewhere, spot silver climbed 1.4% to $54.15 per ounce, moving towards a record high touched on October 17.
Platinum was flat at $1,614.95 and palladium rose 0.8% to $1,486.28.
