International gold prices surged to an all-time high on Thursday, driven by expectations of a U.S. interest rate cut. According to CNBC, the spot price of gold reached $2,554.05 per ounce by 2:10 PM Eastern Time, setting a new record. U.S. gold futures also closed up 1.5% at $2,580.60.
The Federal Reserve’s anticipated interest rate reduction during its upcoming Federal Open Market Committee (FOMC) meeting on September 17 to 18 has contributed to this increase in gold prices. Typically, gold prices rise when inflation fears loom large, as it is viewed as a hedge against inflation.
CEO of OptionsSellers.com, James Cordier, said, “Lower rates generally translate to a weaker currency, and all of a sudden, you have a new form of inflation scare.” He explained that this situation usually draws more investors to precious metals, which in turn drives their prices higher.
