September 9, 2025 | Dubai, UAE (The Arabian Wall Street) — Gold prices surged to record highs on Tuesday, driven by expectations of a U.S. Federal Reserve rate cut, a softer dollar, and falling Treasury yields.
Spot gold climbed 0.5% to $3,655.70 per ounce as of 7:47 a.m. AST Arabia, while December gold futures advanced 0.4% to $3,692. Traders are now pricing in an 89.4% chance of a quarter-point Fed rate cut this month and a 10.6% probability of a half-point move, according to CME’s FedWatch tool.
Lower interest rates tend to weaken the dollar and reduce bond yields, raising the appeal of non-yielding bullion. On Tuesday, the dollar index slipped to a seven-week low, while the U.S. 10-year Treasury yield fell to its lowest in five months.
Tim Waterer, Chief Market Analyst at KCM Trade, told Reuters: “We probably will see more upside in gold from here, provided that the U.S. central bank delivers with regards to market expectations of seeing multiple rate cuts.”
Precious metals performance
- Silver rose slightly by 0.05% to $41.4 per ounce
- Platinum gained 0.8% to $1,397.7
- Palladium advanced 1.1% to $1,146.6
Outlook for gold
So far in 2025, gold has rallied 38%, extending a 27% surge in 2024, supported by central bank demand, dovish monetary policies, and global uncertainty.
Goldman Sachs forecasts gold could reach $3,700 by end-2025 and $4,000 by mid-2026, with a potential spike toward $5,000 if investors shift even 1% of privately held U.S. Treasuries into bullion. A “tail-risk” scenario sees prices hitting $4,500 amid greater diversification.
Eyes on U.S. data
Markets are now awaiting U.S. producer price data on Wednesday and consumer price data on Thursday. Analysts say softer inflation readings could reinforce the Fed’s dovish stance and accelerate gold’s path toward the $3,700 level.
