(Bloomberg) — Gold edged lower amid dwindling expectations that the US Federal Reserve will cut interest rates until a backlog of data provides a clearer picture of the world’s biggest economy.
A faction of Federal Reserve policymakers has stepped up warnings that inflation progress could slow or stall, casting doubt over the prospects for another rate cut in December and laying bare a deepening divide at the central bank. Lower interest rates typically make non-yielding bullion more appealing to investors.
Most Read from Bloomberg
Investors and policymakers are awaiting a flurry of data held up by the longest US government shutdown in history. A six-week absence of reliable statistics on the American labor market and inflation made some officials increasingly reluctant to commit to further monetary easing. Interest rate swaps now imply a less-than-50% likelihood of a December rate cut after all but pricing in a quarter-point reduction less than a month ago.
“The shutdown is over, but the data fog it created is still clouding markets — the next few weeks will deliver numbers we barely have a handle on,” said Hebe Chen, a strategist at Vantage Markets in Melbourne. “That keeps the Fed’s rate-cut path far from clear.”
Gold is still up about 55% this year and remains on target for its best annual performance since 1979. A scorching rally to a record above $4,380 an ounce last month has been underpinned by elevated central-bank purchases, while investors have also piled into the precious metals as a hedge against growing fiscal unease in some of the world’s biggest economies.
Gold was 0.3% lower at $4,070.39 as of 10:27 a.m. in New York. The Bloomberg Dollar Spot Index was up 0.2%. Silver rose, while palladium and platinum fell.
–With assistance from Jack Ryan and Yvonne Yue Li.
Most Read from Bloomberg Businessweek
©2025 Bloomberg L.P.
