Gold Extends Rally as Economic Uncertainty and Central Bank Buying Lift Prices
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Gold rises above $4,200 as weak US data and central bank buying bolster demand.
Gold prices climbed on Thursday, extending a week-long rally as investors continued to hedge against uncertainty over the US economy, even after lawmakers moved to end the government shutdown.
Spot gold was trading at $4,234.63 an ounce by 09:25 GMT.
The yellow metal has seen steady support in recent sessions as a series of weak private labour market readings revived expectations of a Federal Reserve rate cut in December. Markets are now pricing in a roughly two-thirds chance of a 25-basis-point reduction, according to CME data.
Central bank demand has also provided firm support. The People’s Bank of China purchased gold for a 12th consecutive month in September, underscoring persistent official-sector appetite for the metal as global reserves diversify away from the dollar.
President Donald Trump late Wednesday signed a bill reopening the US government, ending a record-breaking shutdown that lasted more than six weeks. The move will allow the release of delayed economic data, with investors now bracing for weak figures reflecting the disruption.
Trump claimed the shutdown cost the US economy $1.5 trillion, a figure likely to be contested but which adds to the growing sense of fragility in the outlook.
Despite improved risk sentiment, traders continue to favour gold as a defensive play, with renewed buying from central banks and signs of softening growth helping keep prices elevated.