Rate-cut buzz rockets gold past $3,700 as dollar sinks

Gold just blasted into uncharted territory. Spot prices jumped above $3,700 an ounce for the first time on Tuesday, as traders piled in ahead of the Fed’s two-day policy meeting and a wobbly dollar slid to a two-month low.

By late morning in New York, spot gold was up about 0.5% around $3,699 after tagging a record near $3,703. December futures added roughly the same, trading in the mid-$3,730s. The driver mix wasn’t subtle: a softer greenback (making bullion cheaper for non-US buyers), heavy safe-haven demand, and persistent central-bank buying—all turbocharged by expectations the Fed will cut rates on Wednesday.

Markets have a quarter-point cut basically locked in, with a small chance of 50 bps. Lower yields are catnip for non-interest-bearing assets like gold. The metal is now up about 40% this year, having blown through $3,600 on Sept. 8 before sprinting higher.

Worth noting: despite today’s moonshot, Commerzbank just lifted its year-ahead call to $3,600/oz by end-2025—a target that actually sits below current spot, implying some mean reversion if the rate-cut euphoria cools.

Elsewhere in the complex, silver climbed to about $42.8—its highest since 2011—while platinum and palladium eased.

Bottom line: with the dollar on the back foot and a rate cut looming, the path of least resistance for gold has been up. The next move hangs on the Fed’s tone—especially the dots. A dovish tilt could keep the rally humming; a tougher message could finally test those fresh highs.

With input from Reuters and CNBC.