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Gold rises for third straight month after US rate cut
Gold prices held above $4,000 an ounce on Friday, October 31, amid uncertainty over further interest rate cuts by the US Federal Reserve this year, but the precious metal is on track for its third consecutive monthly gain.
Spot gold was steady at $4,023.44 an ounce by 1:32 PM GMT, after falling to $3,988.37 earlier in the session.
The metal has risen about 4% so far this month.
Meanwhile, US gold futures for December delivery fell 0.49% to $3,997 an ounce.
The US Federal Reserve cut interest rates by a quarter of a percentage point on Wednesday for the second time this year, bringing the target range for the federal funds rate to between 3.75% and 4%.
Gold, which does not offer interest, benefits from low interest rates and periods of economic uncertainty, as it is seen as a safe haven during times of volatility.
According to the CME Group’s FedWatch tool, markets are pricing in a 74.8% probability of a 25-basis-point rate cut at the December meeting, compared to 91.1% a week ago, following comments by Federal Reserve Chair Jerome Powell that reduced the likelihood of further cuts this year.
Meanwhile, the dollar index held near its highest level in three months against a basket of currencies, making gold more expensive for holders of other currencies.
On the trade front, US President Donald Trump said on Thursday that he had reached an agreement with Chinese President Xi Jinping to reduce tariffs on Chinese goods in exchange for Beijing cracking down on illicit fentanyl trade, resuming purchases of US soybeans, and maintaining the flow of rare earth mineral exports.
As for the rest of the precious metals, silver settled in spot trading at $48.92 an ounce, while platinum rose 0.2% to $1,613.50, and palladium increased 2.1% to $1,474.51.
