Gold Steadies as Traders Look for Clues on Fed’s Rate Path

(Bloomberg) -- Gold steadied as traders upped bets on the Federal Reserve cutting interest rates next month, following pressure from US Treasury Secretary Scott Bessent.

Bullion rose as much as 0.6% on Thursday before erasing those gains to trade near $3,357 an ounce. Prices saw a modest increase in the previous session, supported by a fall in Treasury yields after Bessent suggested the Fed’s benchmark rate ought to be at least 1.5 percentage points lower than it is now. Lower borrowing costs and declining yields tend to support gold, as it pays no interest.

Most Read from Bloomberg

The US-Canadian Road Safety Gap Is Getting Wider Sunseeking Germans Face Swiss Backlash Over Alpine Holiday Congestion To Head Off Severe Storm Surges, Nova Scotia Invests in ‘Living Shorelines’ Five Years After Black Lives Matter, Brussels’ Colonial Statues Remain For Homeless Cyclists, Bikes Bring an Escape From the Streets

The increased bets on monetary easing mark a shift from last month, when markets at one point saw less than a 50% chance of a September rate cut. The consensus is now for a quarter-point move next month, with some betting on a larger reduction. Traders will also monitor US producer price data due later on Thursday for the next clue on the extent to which US inflationary pressures have moderated.

Gold has climbed 28% this year, with the bulk of those gains occurring in the first four months. It has been supported by heightened geopolitical and trade tensions that have spurred haven demand, while central bank purchases have also underpinned its strength.

Spot gold was steady at $3,355.73 an ounce at 1:13 p.m. in London, after rising 0.2% in the previous session. The Bloomberg Dollar Spot Index was little changed. Silver fell, while palladium and platinum rose edged higher.

Last week, confusion over whether gold bars would be subject to US tariffs prompted a spike in the premium for gold futures in New York over the spot price in London. President Donald Trump said on Monday that there would not be a levy — causing the two markets to converge — but formal clarification is still forthcoming.

--With assistance from Jack Ryan.

Most Read from Bloomberg Businessweek

Americans Are Getting Priced Out of Homeownership at Record Rates Dubai’s Housing Boom Is Stoking Fears of Another Crash Bessent on Tariffs, Deficits and Embracing Trump’s Economic Plan Why It’s Actually a Good Time to Buy a House, According to a Zillow Economist The Electric Pickup Truck Boom Turned Into a Big Bust

©2025 Bloomberg L.P.

View Comments