Gold Hits Record High, Silver Reaches Nine-Year Peak

Gold prices surged to a new all-time high on Monday, fueled by increasing optimism surrounding U.S. monetary policy.

Investors are closely watching an upcoming inflation report that could give the Federal Reserve more room to cut interest rates, The Caspian Post reports, citing Bloomberg.

Bullion rose as much as 0.9% to $3,719.95 an ounce on Monday, eclipsing an all-time high set last week after the Federal Reserve on Wednesday reduced rates for the first time since December. Lower rates benefit non-interest bearing precious metals.

Silver rallied even harder with support from bullish options traders, reaching as high as $43.7727 an ounce on Monday. The trading volume of IShares Silver Trust options on Friday surged to 1.2 million - the highest daily turnover of contracts since April 2024 - while call options volumes also spiked. The fervor also spilled over into platinum and palladium, signaling growing investor appetite for precious metals used in key industries.

“Technicals are looking pretty strong, and expectations are rising for deeper rate cuts,” said Soni Kumari, commodity strategist at ANZ Group Holdings Ltd. In silver, “the recent resistance at $43 an ounce was broken, while gold powered through $3,708 an ounce - suggesting prices will continue to push higher.”

Traders will parse incoming data this week, including activity readings in Europe and Friday’s personal consumption expenditures price index in the US. The Fed’s preferred measure of underlying inflation likely grew at a slower pace last month, which would boost the argument for rate cuts. Additionally, Powell is also due to speak on the economic outlook on Tuesday.

Markets are pricing in almost two more rate cuts this year, with the outlook for further Fed monetary easing providing a major catalyst in bullion’s surge of more than 40% this year. Prices have also been supported by haven demand due to concerns over geopolitical conflicts and the impact of US President Donald Trump’s tariffs on the global economy, along with increased central-bank purchases and holdings in exchange-traded funds.

Spot gold was 0.8% higher to $3,715.75 an ounce as of 2:56 p.m. in Singapore. The Bloomberg Dollar Spot Index was flat. Silver rose 1.6%, platinum was up 1% and palladium gained 0.9%.