Gold prices rose in European trading on Thursday, extending gains for a second consecutive session and moving back above the $4,000 per ounce mark, supported by a weaker U.S. dollar in foreign exchange markets.
The longest government shutdown in U.S. history has deepened uncertainty surrounding the country’s economic outlook, potentially complicating the Federal Reserve’s policy decisions.
Price Overview
• Gold Prices Today: Spot gold rose 0.95% to $4,016.87 per ounce, up from an opening level of $3,980.11, after touching an intraday low of $3,964.63.
• On Wednesday, gold gained 1.2%, marking its first increase in four sessions, as the U.S. dollar halted its recent rally.
U.S. Dollar
The U.S. dollar index fell 0.3% on Thursday, extending losses for a second straight session and retreating from a six-month high, reflecting continued weakness against major and minor currencies.
Beyond profit-taking, the greenback’s decline was driven by concerns over the record-long U.S. government shutdown, which has heightened market uncertainty regarding the nation’s economic trajectory.
With the political impasse in Congress keeping the government closed, both investors and the Federal Reserve have been forced to rely on private-sector indicators for guidance.
U.S. Interest Rates
• According to the CME FedWatch tool, markets currently price a 67% probability of a 25-basis-point rate cut at the Fed’s December meeting, while odds of holding rates steady remain at 33%.
• To reassess those expectations, investors are closely monitoring comments from Federal Reserve officials, given the suspension of official U.S. economic data releases.
Gold Outlook
• Tim Waterer, chief market analyst at KCM Trade, said: “The dollar eased slightly, making it easier for gold to build upward momentum.”
• He added: “Gold managed to rise yesterday despite strong U.S. macro data, as traders remained focused on the fact that the current government shutdown is the longest on record.”
SPDR Fund
Holdings in the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, were unchanged on Wednesday, remaining at 1,038.63 metric tons — the lowest level since October 29.
