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Gold prices hit an all-time high on Sept. 2 amid expectations of an interest rate cut and growing uncertainty related to tariffs.
Spot gold hit a new high of around $3,508 per ounce in early trading on Sept. 2, breaking the previous high of roughly $3,500 set on April 22. The precious metal was trading at $3,484 as of 6:45 a.m. EDT, up by 0.22 percent from the previous day.
As for silver, spot prices broke through the $40 per ounce level on Sept. 1 for the first time in 14 years to hit $41.24, the highest level since September 2011. On Sept. 2, spot prices were trading at around $40.50, down 0.5 percent for the day.
In a Sept. 2 post, ING Bank stated the rally in these two precious metals was “underpinned by growing expectations that the US Federal Reserve is poised to resume interest rate cuts with three weeks to go until the next policy meeting.”
The Federal Reserve has kept interest rates unchanged in the range of 4.25 percent to 4.5 percent this year. During his Aug. 22 address at the Jackson Hole Economic Symposium, Federal Reserve Chair Jerome Powell hinted at rate cuts.
“With policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance,” he said.
The next Fed meeting is scheduled for Sept. 16–17.
ING said investors are also looking forward to the U.S. jobs report scheduled to be released on Sept. 5.
“It’s expected to confirm a weakening labour market, strengthening the case for cuts,” the bank stated.
Uncertainty regarding the Trump administration’s tariff policies has heightened in recent days after the U.S. Court of Appeals for the Federal Circuit ruled on Aug. 29 that the reciprocal tariffs unveiled in April are mostly illegal. This uncertainty has contributed to investor demand for gold, lending price support.
On Aug. 31, White House trade adviser Peter Navarro warned that the court ruling would result in negative economic consequences for the country while adding that he was “very optimistic” that the Supreme Court will overturn the appeals court decision.
Meanwhile, President Donald Trump announced in an Aug. 25 letter that he has fired Lisa Cook, a member of the Federal Reserve Board of Governors, from her post, raising concerns for some about the Fed’s independence.
The president said there was cause to remove Cook, citing potential criminal conduct related to alleged false statements on mortgage documents.
Cook, who has refused to step down, has since sued Trump in Washington, alleging that he denied her due process in his attempt to fire her.
“Tariff tensions, along with questions over the Fed’s independence and a weakening dollar, are adding to the tailwinds for the precious metals,” ING Bank stated.
Gold Demand, Price Forecast
While high prices have dampened demand for gold in the United States at the consumer level, investment demand continues to remain strong through gold ETFs, the World Gold Council stated in an Aug. 6 post.
In the second quarter of 2025, “gold jewellery consumption continued its three-year downward trend, slipping 7 percent [year over year to 30 metric tons],” it stated.
“Bar and coin demand dropped to just 9 [metric tons],” which was the lowest since the fourth quarter of 2019, and a 53 percent year over year decline, according to the council.
“In Q1 and Q2, ETF demand accounted for 70 percent 133 [metric tons] and 56 percent 70 [metric tons], respectively, of total US investment demand,” the council stated.
“That’s a sharp contrast to the same period last year, when demand fell 9 [metric tons], and well above the 10-year quarterly average of 19 [metric tons].”
As for where gold prices are headed, a June 10 report from JP Morgan predicted prices to average $3,675 per ounce in the fourth quarter of this year. The investment company forecasts prices to average $4,160 per ounce in the third quarter of 2026.
In an Aug. 25 post at Bank of America Private Bank, market strategist Joe Quinlan said that many Wall Street experts were expecting gold prices to exceed $4,000.
“With global central banks, China, and others increasing their holdings, individual investors may want to consider whether adding some gold makes sense for their own portfolio,” Quinlan said.
