Gold prices hit a record high on Monday morning, as positive US inflation rates boosted expectations that the US Federal Reserve could deliver its first interest rate cut soon.
US gold futures rose 1% at $2,440.60, while spot gold was up 0.9% at $2,436.76 per ounce, as of 03:40 GMT, after hitting a record high of $2440.49 earlier in the session. Spot silver rose 2.5% to $32.28 after hitting an over 11-year high.
The gold prices have risen by over Dh18 per gram since the start of this year, as a result of rising inflation as well as geopolitical uncertainty, said Andrew Naylor, of the World Gold Council (WGC).
In early May, the US Federal Reserve decided to maintain interest rates at a 23-year peak amidst persistent increases in the cost of living. Despite indications of inflation easing at a slower rate than desired in recent economic reports, the central bank chose to keep the benchmark lending rate steady at 5.25-5.50%.
Nonetheless, the latest US data showed signs of cooling inflation, leading traders to expect a 65% chance of a US rate cut by September, according to Reuters.
