Gold prices surged to a new all-time high on Monday, with investors rushing into safe-haven assets amid mounting political uncertainty in Washington.
Spot gold jumped 1.7% to $3,831.27 per ounce, around $50 above its previous record, while US futures touched $3,860.60 in New York trading. The rally comes as the US dollar weakened 0.3%, adding momentum to bullion’s historic run.
Shutdown Risk Fuels Demand
The surge follows renewed fears of a potential US government shutdown as congressional leaders prepare for critical funding negotiations with President Donald Trump ahead of the September 30 deadline.
“Safe-haven demand focused on the potential US government shutdown is one of the driving factors behind this rally,” said David Meger, director of metals trading at High Ridge Futures.
A shutdown could also delay key economic data, including Friday’s payrolls report, injecting further uncertainty into the Federal Reserve’s policy outlook. Weaker jobs data would likely strengthen the case for additional rate cuts in October — a bullish scenario for gold.
Central Bank Pressure on the Fed
Traders are also weighing risks to the US central bank’s independence, with ongoing legal battles surrounding Fed Governor Lisa Cook’s position. Barclays strategists noted that gold still looks “a surprisingly good value hedge” against both dollar weakness and Treasury yields, given the level of political and policy risk.
Year-to-Date Performance
Gold is now up 45% year-to-date, marking its strongest run since the late 1970s. Holdings in gold-backed ETFs are at their highest since 2022, while central-bank demand continues to underpin prices.
Major banks remain bullish: Goldman Sachs sees prices reaching $5,000 if political pressure on the Fed persists, while JPMorgan projects $6,000 by the end of Trump’s term.
Silver and Other Precious Metals Join the Rally
Gold’s peers have also posted extraordinary gains this year. Silver is up nearly 60%, trading above $47 per ounce, close to levels last seen in 2011. Platinum and palladium markets remain tight, with borrowing costs spiking as supply deficits deepen.
Citigroup analysts warn that potential US tariffs on platinum-group metals under Trump’s Section 232 investigation could further exacerbate shortages, particularly in palladium.
