Gold fell on Tuesday as investors booked profits after prices hit a record high earlier in the session, while concerns about a looming US government shutdown and increased bets of a Federal Reserve rate cut limited losses.
Spot gold fell 0.7 per cent to $3,805.99 per ounce, after rising 1 per cent to hit a record high of $3,871.45 during Asia hours. Bullion has risen 10.5 per cent so far in September, and is on track for its biggest monthly percentage gain since July 2020.
Swissquote external analyst Carlo Alberto De Casa said gold has pared gains on profit-taking after rising as much as 1 per cent during Asia hours and “so far this is just a technical correction and we are not talking about an inversion.”
US President Donald Trump and his Democratic opponents appeared to make little progress at a White House meeting aimed at heading off a government shutdown that could disrupt a wide range of services as soon as Wednesday.
“The risk of shutdown for gold is positive because it means uncertainty and that the Federal Reserve doesn’t have clear data because that could arrive late,” De Casa added.
Markets expect an over 91 per cent chance of a 25-basis-point reduction at the Fed’s October meeting, according to CME Group’s FedWatch tool.Investors now await a slew of US data including Friday’s non-farm payrolls for further clues on the economy’s health.
The US Labor Department confirmed on Monday that its statistics agency would suspend data releases, including the closely-watched monthly employment report in the event of a partial government shutdown.
UBS expects gold could rise as high as $4,200/oz by mid-2026 in its bull case scenario, the bank said in a note on Tuesday.
Gold, viewed as a safe-haven asset in times of geopolitical and economic uncertainty, tends to do well in a low-interest rate environment.
Shares of China’s Zijin Gold International rose 66 per cent in their Hong Kong trading debut, after the company raised $3.2bn in an initial public offering (IPO), the largest deal of its kind globally in 2025.
Elsewhere, spot silver lost 1.7 per cent to $46.14 per ounce but has climbed 16.3 per cent so far this month. Platinum fell 3.1 per cent to $1,551.80 and palladium lost 3 per cent to $1,230.19.
