At the close of trading on 2/9, the spot price of gold increased by 58 USD, reaching a record high of 3,531 USD per ounce. During the session, the price briefly neared 3,540 USD.

Investors are flocking to the precious metal amid growing expectations that the US Federal Reserve (Fed) will cut interest rates. Political and economic risks are also escalating. Since the beginning of the year, the global price of gold has risen by 35%.

Global gold prices have been continuously rising in recent sessions. Chart: Kitco

"The gold market is entering the peak consumption season of the year. Coupled with expectations of a Fed rate cut in their September meeting, we anticipate that prices will continue to reach new highs," commented Suki Cooper, precious metals analyst at Standard Chartered Bank.

CME's FedWatch tool, which tracks interest rate probabilities, indicates a 92% market expectation of a Fed rate cut this month. Gold prices tend to rise in a low-interest-rate environment.

Analysts suggest this year's gold rally is reinforced by sustained buying from central banks, the need for diversification to reduce reliance on the US dollar, safe-haven demand amid political and trade tensions, and a weakening US dollar.

Uncertainty surrounding US President Donald Trump's policies further enhances gold's appeal. His conflicts with the Fed, notably his criticism of Chairman Jerome Powell and efforts to remove Governor Lisa Cook, are raising concerns about the central bank's independence.

"The accusations against Cook are a clear warning to other Fed members to lower interest rates under government pressure. This makes gold investment more attractive," commented Commerzbank analysts.

This week, investors await the US jobs report for further clues about the scale of potential rate cuts. A less optimistic report could increase the probability of a 50 basis point (0.5%) cut, according to Zain Vawda, an analyst at MarketPulse by OANDA.

Purchases by gold exchange-traded funds (ETFs) have also bolstered gold's upward momentum this year. SPDR Gold Trust, the world's largest gold ETF, reported a 1% increase in gold reserves last weekend to 977.6 tons, the highest level since August 2022.

Natasha Kaneva, Head of Global Commodities Strategy at JP Morgan, predicts gold could reach 3,675 USD by the end of this year and 4,250 USD by the end of next year.

Ha Thu (according to Reuters, Kitco)