Gold Climbs to Record Amid US Shutdown, Fed Rate Cut Expectations

02:33 PM EDT, 10/06/2025 (MT Newswires) -- Gold hit an all-time high on Monday as the ongoing US government shutdown boosted demand for the safe-haven asset amid expectations of another rate cut from the Federal Reserve.

Spot gold topped $3,950 per ounce for the first time, and was last trading at $3,955.80, up 1.8%. Gold for December delivery jumped 1.8% to $3,980.57 per ounce.

A federal government shutdown that started Wednesday continued after US lawmakers failed to agree on a key spending bill. The Senate is scheduled to vote around 5:30 pm ET Monday on a House bill that would fund the government until Nov. 21, though the measure is unlikely to pass, CNBC reported.

The shutdown delayed September jobs data that were supposed to be released Friday, a key report for Fed policymakers who will meet later this month to decide on interest rates.

"The prolonged US shutdown fueled investors' demand for safe-haven assets," ING said in a report on Monday. "The US disruption has delayed payroll data expected last Friday, further clouding an already uncertain economic outlook."

Gold prices have soared nearly 50% this year, driven by mounting economic and geopolitical uncertainty, ING Head of Commodities Strategy Warren Patterson said. "The Federal Reserve's rate cuts and central bank moves to diversify away from dollar assets have also provided strong support," Patterson wrote.

Markets widely expect the Fed's monetary policy committee to again cut rates by 25 basis points this month, according to the CME FedWatch tool. Prices of the yellow metal have an inverse relationship with interest rates.

"Private and institutional investors continue to add exposure through bullion-backed (exchange-traded funds) amid fears of missing out on a year-long rally driven by persistent fiscal and geopolitical risks, including growing doubts about Federal Reserve independence and the ongoing US government shutdown," Saxo Bank said in a report.

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