FX.co ★ Gold Hits Record High Ahead of Fed Decision

Gold prices have ascended to an unprecedented high, approaching $3,690 per ounce, driven by stronger-than-anticipated US economic data and investor anticipation of the Federal Reserve’s policy announcement scheduled for Wednesday. The latest data shows August retail sales outpacing expectations, alongside import prices seeing their largest increase in seven months, contrary to forecasts of a slight dip. This robust economic performance has strengthened beliefs that, despite signs of a cooling labor market, the Federal Reserve will implement a 25 basis points rate cut—its first since December—and potentially indicate an easing cycle that may continue until 2026. All eyes will be on the Fed’s quarterly Summary of Economic Projections, including the dot plot, and Chair Jerome Powell’s press conference for insights into future policy directions. Meanwhile, gold, boosted by trade and geopolitical tensions, strong central bank demand, and consistent ETF inflows, has already experienced a significant rally of 40% this year.