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Gold price hits record high

Gold hit a record high on Monday as growing optimism that the Federal Reserve will cut US interest rates in the new year has dented the dollar in recent weeks.

The precious metal, seen as a haven investment, reached an all-time pinnacle at $2,135.39 an ounce.

Profit-taking later set in, leaving it to trade at $2,043.80.

The dollar was also firmer on Monday.

Gold is benefitting from the Israel-Hamas war, according to analysts.

“Concerns about the shaky global economic backdrop and the Israel-Hamas conflict have fuelled investor demand for safe haven assets like gold,” said Victoria Scholar, head of investment at Interactive Investor.

“Plus, expectations for Fed rate cuts next year have put downward pressure on the US dollar, which is trading around three-month lows, adding to gold’s attractiveness.”

Elsewhere, bitcoin traded above $40,000 for the first time since May last year, boosted by hopes that the United States would soon allow broader trading of the world’s biggest cryptocurrency.

Major stock markets mostly fell.

Traders are shrugging off Fed boss Jerome Powell’s attempts to temper expectations of US rate cuts in the first quarter of 2024.

Bets on an easing of monetary policy were ramped up when Powell on Friday said that it was “well into restrictive territory” after more than a year of hikes that have put borrowing costs at a two-decade high.

Central banks around the globe have sent interest rates soaring, helping to bring down surging inflation.

Bloomberg reported that traders expect a 60 per cent chance of a US rate cut, while they have fully priced in one by May.

“Markets are piling in on the rate cut bets,” said Kyle Rodda at

He added that recession risks added to gold’s appeal.

Bitcoin reached a 19-month high on hopes that firms including BlackRock would be given US approval to sell the first spot bitcoin exchange-traded funds.

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