Gold heads for seventh weekly gain as uncertainty boosts safe-haven demand

WEB DESK: Gold prices held firm on Friday, putting the precious metal on track for a seventh straight weekly gain, as worries over a prolonged US government shutdown and expectations of more interest rate cuts fuelled demand for the safe haven.

Spot gold inched up 0.1 percent to $3,859.09 per ounce by 6:23 GMT, having touched a record high of $3,896.49 a day earlier. The metal has risen 2.5 percent so far this week, while US gold futures for December delivery climbed 0.4 percent to $3,882.40.

Tim Waterer, chief market analyst at KCM Trade, said gold’s rally faced only a brief pause due to the stronger dollar. “The precious metal is still within shouting distance of the $3,900 level. With lower US rates likely this month and a government shutdown weighing on growth, gold’s upward momentum remains intact,” he noted.

US shutdown and rate cut bets

The political deadlock in Washington has pushed the government shutdown into its second day, raising concerns about delays in the release of key economic indicators such as Friday’s non-farm payrolls report. The uncertainty has added to gold’s appeal as investors search for stability.

At the same time, markets are increasingly betting on more cuts from the US Federal Reserve. Traders now see near-certainty of another 25 basis-point reduction this month, according to CME Group’s FedWatch tool.

While Dallas Fed President Lorie Logan recently urged caution on further easing, she acknowledged that last month’s cut was a pre-emptive step to protect the labour market. Recent data pointing to a slowdown has strengthened views that the Fed will keep loosening policy through the year.

Gold tends to thrive in such conditions, as lower interest rates reduce the opportunity cost of holding the non-yielding metal. The yellow metal has already gained an eye-catching 47 percent since the start of 2025.

Global demand stays strong

Adding to the bullish picture, the Perth Mint reported a 21 percent surge in gold product sales during September, with silver sales climbing to a five-month high. In other precious metals, spot silver rose 0.6 percent to $47.24 an ounce, palladium advanced 0.6 percent to $1,248.40, while platinum edged down 0.1 percent to $1,566.90.

Gold prices ease in Pakistan after hitting all-time high

In Pakistan, however, bullion prices cooled slightly after their own record-breaking rally. According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of gold per tola dropped by Rs2,500 on Thursday, settling at Rs407,778. The price of 10 grammes also fell by Rs2,144 to Rs349,603.

On Wednesday, domestic prices had surged to an all-time high of Rs410,278 per tola, following a sharp single-day jump of Rs3,500. Traders said the local decline mirrored the slight retreat seen in international markets, though overall sentiment remains bullish as global demand continues to strengthen.