S&P 500 jumps as tech rallies as investors eye end of government shutdown
Investing.com-- Gold prices rose sharply Monday, rising back above the much-touted $4,000 an ounce level on some weakness in the dollar amid rising expectations of another interest rate cut by the Federal Reserve.
At 09:15 ET (14:15 GMT), Spot gold rose 2.2% to $4,085.51/oz and gold futures for December rose 2.1% to $4,094.85/oz.
Gold aided by soft dollar amid rate cut speculation
Gold advanced to a two-week high Monday, helped by the U.S. dollar extending the mild declines seen last week as weak economic data bolstered the chance of the U.S. central bank cutting interest rates again in December.
On Friday, the University of Michigan’s consumer sentiment index weakened to its lowest level in nearly 3-1/2 years in early November, while Challenger jobs data earlier in the week showed the U.S. suffered its worst round of layoffs in about 20 years in October.
Traders were pricing in a 61.9% chance the Fed will cut rates by 25 bps in December, CME Fedwatch showed.
Lower U.S. interest rates weigh on the greenback, helping commodities, like gold, which are denominated in dollars, as well as benefiting the assets which are not interest bearing.
Broader metal prices also advanced on a softer dollar. Spot platinum rose 2.8% to $1,592.30/oz, while spot silver rose 3.3% to $49.735/oz.
U.S. government shutdown end in focus
Market sentiment was also aided by the Senate voting to proceed with a funding bill expected to end the longest U.S. government shutdown ever.
The Senate voted 60-40 to consider the spending bill, and will hold a final vote on the bill in the coming days.
The bill marked the breaking of a Democratic filibuster in the Senate, which was largely behind the government shutdown remaining in place so far.
The ending of the shutdown is also expected to open the door for more U.S. economic data releases in the coming days.
Ambar Warrick contributed to this article
The yellow metal was also aided by sustained bets that the Federal Reserve will cut interest rates in December, although markets still remained skeptical over such a scenario, given a lack of clear cues on the U.S. economy.