US gold futures top USD 4,000 mark as record run gathers pace

US gold futures surged past the USD 4,000 per ounce milestone for the first time on Tuesday, driven by expectations of a Federal Reserve rate cut later this month and persistent safe-haven demand due to the ongoing US government shutdown.

US gold futures for December delivery settled 0.7% higher at USD 4,004.4, after hitting a high of USD 4,014.6.

Spot gold was up 0.6% to USD 3,985.82 per ounce as of 01:48 p.m. EDT (17:48 GMT), after hitting an all-time high of USD 3,990.85 earlier in the session.

The primary market for spot gold is the London over-the-counter (OTC) market, which serves as the global benchmark for pricing.

“It’s ongoing safe-haven flows stemming in part from the government shutdown and no real indication that is likely to be resolved in the immediate term here. So there’s still a pretty decent bid in gold,” said Peter Grant, vice president and senior metals strategist at Zaner Metals.

Non-yielding gold, which tends to do well during times of uncertainty and low interest-rate environments, has climbed 51% so far this year. The metal’s rally has been driven by a cocktail of factors, including expectations of interest rate cuts, ongoing political and economic uncertainty, solid central bank buying, inflows into gold ETFs and a weak dollar.

The US government shutdown entered its seventh day on Tuesday. The shutdown has postponed the release of key economic indicators, forcing investors to rely on secondary, non-government data to gauge the timing and extent of Fed rate cuts.

Investors are now pricing in a 25-basis-point cut at the Fed meeting this month, with an additional 25-bp cut anticipated in December.

Meanwhile, political turmoil in France and Japan gripped currency and bond markets for a second day.

China’s central bank added gold to its reserves in September for the 11th straight month, data from the People’s Bank of China showed.

Goldman Sachs raised on Monday its December 2026 gold price forecast to USD 4,900 per ounce from USD 4,300, citing strong Western exchange-traded fund (ETF) inflows and likely central bank buying.

Elsewhere, spot silver was down 1.4% at USD 47.86 per ounce, platinum fell 0.5% to USD 1,617.41 and palladium was up 2.1% at USD 1,347.52.

(Reporting by Anushree Mukherjee and Kavya Balaraman in Bengaluru; Additional reporting by Sarah Qureshi; Editing by Vijay Kishore and Nick Zieminski)