Investors switched to safe-haven assets amongst growing economic uncertainty worldwide. Gold prices poured to an all-time high of $3,508.50 per ounce on Tuesday, sustained by growing prospects of a Federal Reserve interest rate cut in September and a weaker US dollar. The valuable metal has now grown over 30% year-to-date, determined by a combination of monetary policy outlooks, geopolitical hazards, and safe-haven demand.
The rally comes as the US dollar index soars near its lowest level in more than a month, making gold economical at low price for holders of other currencies. Traders are now valuing in a 90% probability of a 25-basis point rate cut at the Fed’s September 17 meeting.
Fed Independence Under Pressure as Political Tensions Mount
Current political advances have further fueled ambiguity in US monetary policy. President Donald Trump has escalated disapproval of the Federal Reserve and its Chair Jerome Powell, together with over a renovation project at the Fed’s Washington headquarters. This has fuelled concerns about the central bank’s freedom, a crucial pillar of its trustworthiness in financial markets.
In an interview with Reuters, Treasury Secretary Scott Bessent reiterated the significance of Fed autonomy but defended Trump’s right to dismiss Fed Governor Lisa Cook, mentioning allegations of mortgage fraud, presently the subject of an internal investigation.
Analysts advise that the political rhetoric and pressure on the Fed could dent stakeholder’s confidence in dollar-denominated resources, rushing a shift towards valuable metals.
Central Bank Buying and Safe-Haven Demand Boost Bullion
Gold’s rally in 2025 shapes on a 27% gain in 2024, with prices first penetrating the $3,000 per ounce mark in March.
Some of the analysts estimates that gold could rise to $3,600 or higher by year-end if the Fed gears up several rate cuts and geopolitical uncertainties persist, together with fears around the Russia-Ukraine conflict.
Silver prices, in the meantime, were stable at $40.64 per ounce, holding near their highest levels subsequent to September 2011.
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Ankur Mishra is a journalist who covers an extensive range of news, from business, stock markets, IPOs to geopolitics, world affairs, international crises, and general news. With over a decade of experience in the business domain, Ankur has been associated with some of the reputed media brands. Through a sharp eye on global marketplaces along with deep insights and analysis of business strategies, Ankur brings simplicity to the complex economic matrix to decode market trends and empower people.
He is committed to entrenched data, facts, research, solutions, and a dedication to value-based journalism. He has covered trade tariff wars, international alliances, corporate policies, government initiatives, regulatory developments, along with micro- and macroeconomic shifts impacting global fiscal dynamics.
