Gold prices rose sharply in Asian trade on Monday, rising back above the coveted $4,000 an ounce level on some weakness in the dollar, with focus chiefly on Congress’ attempts to end a U.S. government shutdown.
The yellow metal was also aided by sustained bets that the Federal Reserve will cut interest rates in December, although markets still remained skeptical over such a scenario, given a lack of clear cues on the U.S. economy.
Spot gold rose 1.4% to $4,053.72/oz, while gold futures for December rose 1.3% to $4,062.45/oz by 23:43 ET (04:43 GMT).
Gold, metal prices aided by soft dollar amid rate cut speculation Gold and other metal prices advanced against a softer dollar on Monday, as the greenback extended mild declines seen last week.
Markets were seen largely maintaining bets that the Fed will cut interest rates by 25 basis points in December, especially after a slew of weak private readings on the job market last week.
Challenger jobs data showed the U.S. suffered its worst round of layoffs in about 20 years in October. The print ramped up bets that the Fed will cut rates to prevent further labor market weakness.
Traders were pricing in a 61.9% chance the Fed will cut rates by 25 bps in December, CME Fedwatch showed.
Broader metal prices advanced on a softer dollar. Spot platinum rose 1.4% to $1,571.92/oz, while spot silver rose 1.8% to $49.2185/oz.
US government shutdown end in focus Market sentiment was also aided by the Senate voting to proceed with a funding bill expected to end the longest U.S. government shutdown ever.
The Senate voted 60-40 to consider the spending bill, and will hold a final vote on the bill in the coming days.
The bill marked the breaking of a Democratic filibuster in the Senate, which was largely behind the government shutdown remaining in place so far.
The ending of the shutdown is also expected to open the door for more U.S. economic data releases in the coming days.
