Gold Hits Record High, Dollar Weakens as Markets Brace for Fed Rate Cut Signals
Gold Hits Record High, Dollar Weakens as Markets Brace for Fed Rate Cut Signals
Global financial markets are keenly observing economic indicators today as gold prices surged to a new record high, while the U.S. dollar hovered near five-week lows. Investors are preparing for a critical week of economic data, most notably Friday’s U.S. nonfarm payrolls report, which is expected to heavily influence the Federal Reserve’s upcoming policy decisions.
Market participants widely anticipate the Fed to lower interest rates later this month, with an 89% chance of a 25 basis point cut priced in. Analysts suggest that an exceptionally weak August jobs report could even prompt a larger ‘jumbo’ rate reduction. The U.S. inflation report for August, scheduled for release on September 11, will also provide crucial insights ahead of the central bank’s policy meeting.
The outlook for lower borrowing costs has provided a lift to equity markets. Asia-Pacific shares, excluding Japan, saw modest gains, and Japan’s Nikkei also rose. China’s blue-chip CSI300 index continued its impressive run, reaching a three-year high for the third straight session, partly fueled by enthusiasm for artificial intelligence. In currency markets, the euro held steady, and sterling traded near two-week highs, as the dollar index maintained its position around 97.717.
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