Gold Prices Hit Record Highs Above $3,750 Per Ounce Following Fed Statements

Gold prices surged to new record levels during Asian trading on Tuesday, driven primarily by an increase in demand for safe-haven assets. This surge follows recent statements from Federal Reserve officials that have sparked caution about future interest rate cuts.

Markets are also on edge ahead of a series of key U.S. economic indicators this week, most notably a speech by Fed Chair Jerome Powell. Today's release of the August Purchasing Managers' Index (PMI) data and the main inflation gauge (PCE price index) later in the week are also highly anticipated.

Fed Comments and Market Uncertainty

On Monday, several Federal Reserve officials adopted a cautious stance on the prospects of further interest rate cuts. Atlanta Fed President Raphael Bostic stated in an interview that he did not favor an October rate cut, citing concerns about persistent inflation. Cleveland Fed President Beth Hammack echoed these concerns, suggesting that current policy is not sufficiently restrictive.

In contrast, newly appointed board member Stephen Miran called for more aggressive rate cuts, aligning with President Donald Trump's view that interest rates should be significantly lowered. Trump's recent actions, including new tariffs on a common work visa, and controversial claims about vaccines and pharmaceuticals, have added to market uncertainty, pushing investors toward gold.

Upcoming Economic Data

All eyes are on this week's key economic releases, which will provide further clues on the Fed's monetary policy direction. Today, the U.S. September PMI data is expected to show slightly slower growth in both manufacturing and services. On Friday, the Personal Consumption Expenditures (PCE) price index, the Fed's preferred inflation gauge, will be released. The data is expected to show that core inflation remains above the Fed's annual 2% target, potentially strengthening the arguments of those who favor a more hawkish stance.

Other metals also benefited from last week's Fed rate cut, with platinum and silver prices rising. However, industrial metals like copper saw a slight decline.