By Mudit Dube
Copyright newsbytesapp
Gold prices hit a record high on Wednesday, fueled by fears of the impact of US government shutdown and weak labor data. Spot gold rose 0.4% to $3,872.87 per ounce at 2:06am GMT while US gold futures for December delivery gained 0.7% to $3,901.40. The dollar index hovered near a one-week low, making dollar-priced gold more affordable for overseas buyers. The US government faces a shutdown due to a political deadlock over a short-term spending measure. Republicans in the House passed a Continuing Resolution to fund the government through November 21, but the Senate did not approve it. A shutdown doesn’t mean the government is out of money, only that it lacks legal authority to spend on many programs. President Trump has also threatened additional federal workforce cuts, fueling uncertainty and driving investors toward safe-haven assets like gold. Recent US labor data has shown a slight increase in job openings for August but a decline in hiring. This indicates softening labor market conditions and strengthens the case for further interest rate cuts by the Federal Reserve. Traders are now pricing in a 97% chance of a 25-basis-point cut this month and a 76% chance in December, according to CME Group’s FedWatch tool. Gold, a traditional hedge against economic and political uncertainty, performs well in a low-interest-rate environment due to its non-yielding nature. The metal has gained significantly this year alone. As per reports, gold price has risen by nearly 40% so far in 2025.
