Gold’s rally has been supported by central-bank buying and rising holdings in gold-backed exchange-traded funds, as the Fed resumed rate cuts.
Gold gained — following a five-day rally that saw it reach new records — as the US government shut down and traders added to bets on Federal Reserve interest-rate cuts following weak private payrolls data.
Bullion traded near $3,880 an ounce, roughly $15 below a peak set on Wednesday, with the suspension in federal operations threatening to create a blackout in crucial economic figures that the Fed needs to make rate decisions. That has left economists, traders and policymakers more reliant on non-government data, like Wednesday’s ADP Research print, which showed a sharp drop in private-sector payrolls in September.
Non-farm payroll numbers, which were due Friday, will be delayed because of the shutdown — which also risks increasing pressure on the dollar. Traders have added to bets the Fed will cut rates twice more this year to support a weakening labor market. Lower borrowing costs tend to boost non-yielding gold, which also becomes cheaper for most buyers when the greenback softens.
The metal has soared 48 per cent this year, putting it on track for the biggest annual gain since 1979. The rally has been supported by central-bank buying and rising holdings in gold-backed exchange-traded funds, as the Fed resumed rate cuts.
Monthly ETF inflows in September were the largest in three years, according to data compiled by Bloomberg. Chinese buyers were also scooping up more gold-backed funds, with the four most popular registering inflows last month following a period of tepid demand.
Elsewhere, the US Supreme Court on Wednesday refused to allow President Donald Trump to immediately oust Fed Governor Lisa Cook while she sues to keep her job. The ruling — which poses a setback to his efforts to exert more control over the central bank — may ease some fears over a potential loss of Fed independence, potentially cooling demand for haven assets such as gold.
Spot gold edged 0.5 per cent higher to $3,884.75 an ounce at 12:22 p.m. in London. The Bloomberg Dollar Spot Index weakened 0.1 per cent. Silver rose slightly, after rallying to the highest in 14 years on Wednesday. Platinum and palladium gained.
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Published on October 2, 2025
