Gold tops $3,800 as Fed rate cut bets grow amid funding risk

Gold climbed above $3,800 an ounce on Wednesday as investors intensified bets on Federal Reserve rate cuts and sought safe‑haven assets amid growing concerns of a U.S. government funding lapse. Market data showed spot gold rose as high as $3,819.59 per ounce and was trading around $3,816.79 by 0923 GMT, while U.S. December futures advanced to roughly $3,846.60, reflecting broad upward pressure across the precious metals complex.

Traders pointed to two main drivers. First, recent U.S. inflation data, including the Personal Consumption Expenditures price index, matched expectations and reinforced views that the Fed will loosen policy, making non‑yielding assets such as gold more attractive. Money markets and the CME FedWatch tool were pricing in a high probability of a 25 basis point cut at the October meeting and additional easing later in the year. Second, political developments in Washington heightened demand for safety. The Senate failed to pass a stopgap funding measure, pushing the country closer to a possible shutdown and delaying the release of key labor reports that markets and policymakers use to assess the economy.

Analysts and market participants said weaker data and...