Gold above $4,000 as Fed-cut bets fuel safe-haven demand

Gold surged above $4,000 an ounce in early October as investors sought safe havens amid U.S. political uncertainty, expectations of lower interest rates and renewed global trade tensions. In New York trading on Tuesday, gold futures were quoted at about $4,003 per ounce and U.S. spot gold climbed toward $4,011, with some sessions later recording intraday highs above $4,050.

The rally was driven by several factors that together pushed money into bullion. A partial U.S. government shutdown delayed release of key economic data, complicating traders’ efforts to assess the timing of Federal Reserve rate cuts and prompting demand for assets viewed as hedges against risk. Market participants have been pricing in a 25 basis point Fed cut at the central bank’s October meeting, with another cut anticipated in December. Political developments in France and Japan, ongoing trade frictions and announcements of higher U.S. tariffs on Chinese imports also contributed to safe-haven flows into gold and silver.

"ongoing safehaven flows stemming in part from the government shutdown and no real indication that it is likely to be resolved in the immediate term here," said Peter Grant, vice-president...