"Gold rose to a fresh record, nearing $4,000-an-ounce, as looming US interest rate cuts and the prospect of a prolonged federal government shutdown lifted demand. The precious metal rallied as much as 2.2% to top $3,970 an ounce in the week's opening session. The upswing, which follows a run of seven weekly gains, has lifted prices more than 50% this year. Gold-backed exchange-traded funds swelled again last week."
"The US shutdown has delayed key data, making a murky economic outlook more unclear. With a lack of official figures, traders are depending on private reports for signals, while the US central bank is also finding it challenging to assess changing conditions. Traders are still pricing in a quarter-point cut this month, which would benefit gold further as it doesn't pay interest."
"Options traders continued to chase a further rally, added even more bullish positions in SPDR Gold Shares ETF. A trader sold $355 calls that were bought in late September when gold was more than 5% lower, and bought $370 calls equivalent to more than 26 million shares, betting on another 1.8% gain by the end of next week. Bullion has pushed higher this year, spurred by central-bank purchases as they diversify away from the US dollar."
Gold climbed to near $4,000 an ounce, rising as much as 2.2% and extending a seven-week winning streak that has pushed prices more than 50% year-to-date. Expectations of upcoming Federal Reserve rate cuts and the uncertainty from a potential prolonged US federal government shutdown increased demand for the non-yielding metal. Delayed official economic data during the shutdown has left markets relying on private reports, complicating Fed assessments while traders still price in a quarter-point cut. Strong inflows into gold-backed ETFs and continued options buying amplified bullish momentum. Central-bank purchases and investor concern about fiat currencies have further supported bullion.
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