NEW YORK — International gold prices shattered previous records on Friday, September 5, buoyed by unexpected signs of a weakening U.S. job market in August and growing anticipation that the Federal Reserve will cut interest rates this month. This surge highlights gold's enduring appeal as a safe-haven asset in times of economic uncertainty.
December gold futures on the New York Mercantile Exchange closed at $3,653.30 per ounce, marking a 1.3% increase from the previous session. The price of spot gold also reached a new all-time high, trading at $3,596.60 per ounce, a 1.4% rise, according to Reuters. At one point, spot gold reached $3,599.90, just shy of the $3,600 mark for the first time.
The rally was triggered by a U.S. Labor Department report showing that non-farm payrolls increased by a mere 22,000 jobs in August, significantly below the Dow Jones' consensus forecast of 75,000. This disappointing figure has fueled speculation that the Fed may not only cut rates sooner but also more aggressively than previously expected. Gold, which offers no interest or dividends, tends to become more attractive when real yields on U.S. Treasury bonds fall. This dynamic, combined with the dollar's depreciation, has pushed gold prices higher.
Additional factors are contributing to the increased demand for gold. Ongoing uncertainty surrounding U.S. tariff policies and recent actions by President Donald Trump—specifically, his attempts to remove Federal Reserve Governor Lisa Cook—have raised investor doubts about the Fed's independence. Such political and economic instability typically drives investors toward the perceived security of gold.
Analysts on Wall Street are confident that gold's rally will continue, citing the dual catalysts of Fed rate cuts and persistent economic uncertainty. Goldman Sachs recently released a report forecasting that gold could potentially reach an unprecedented $5,000 per ounce. This bold prediction is based on a scenario where a perceived erosion of the Fed's independence leads investors to shift a portion of their U.S. Treasury holdings into gold, further bolstering its price.
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