WASHINGTON (dpa-AFX) - Gold traded lower in choppy trade on Tuesday after climbing to a new record high in the precious session against the backdrop of a looming U.S. government shutdown.
Spot gold fell 0.8 percent to $3,803.26 per ounce in European trade after reaching a new record high of $3,871.72 earlier. U.S. gold futures were down 0.6 percent at $3,831.12.
Traders braced for a possible U.S. government shutdown, which could start Tuesday midnight (local time) if Congress fails to reach an agreement.
A shutdown could delay releases of key U.S. economic data, including closely watched employment data for September, construction spending and possibly international trade data for August.
St. Louis Federal Reserve President Alberto Musalem said on Monday that he was open to further interest rate cuts but stressed that caution is needed against the backdrop of high inflation that remains roughly a percentage point above the central bank's 2 percent target.
Separately, Federal Reserve Bank of New York President John Williams said inflation risks have receded, while those for employment have moved up.
On the geopolitical front, U.S. President Donald Trump has announced the support of Israel for a U.S.-sponsored peace deal to end the war in Gaza.
The 20-point peace plan seeks an immediate ceasefire, an exchange of hostages held by Hamas for Palestinian prisoners held by Israel, a staged Israeli withdrawal from Gaza, Hamas disarmament and a transitional government led by an international body.
Elsewhere, Russia has warned of a sharp escalation of the ongoing war if the United States supplies Tomahawk cruise missiles to Ukraine.
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