Gold sprints to fresh record high on rate-cut bets

Gold alloys

Gold prices climbed to a fresh record high today, Aug. 1, given the escalating Middle East tensions, as Federal Reserve Chairman Jerome Powell hinted at cutting US interest rates as early as September.

Bullion for December delivery gained 0.75% to $2,491.60 an ounce 9:13 am Makkah time, with the most active contract exceeding the record level recorded in the previous session at $2,473 per ounce.

However, spot prices remained flat at $2,445.53 an ounce after touching its highest level since July 18 during today's trading.

Elsewhere, silver futures for September delivery rose 0.37% to $29.04 per ounce, while platinum spot prices plummeted by 0.61%to $972.73 an ounce.

The Fed decided yesterday to keep interest rates within the 5.25-5.50% range for the fifth time this year. In a press conference following the two-day monetary policy meeting, Powell indicated that interest rates could be brought down by next September if economic data maintained its current stance.

Powell's statements coincided with the release of data yesterday showing a slowdown in the momentum of employment in the US private sector in July, with the annual rate of wage growth declining to a three-year low, a trend that supports the prospects of monetary easing.

Investors are awaiting the release of the US jobs report tomorrow, Aug. 2, to obtain more information about the labor market. The US economy is expected to add 177,000 jobs in July after gaining 206,000 in the previous month.