(Bloomberg) — Gold rose to another record high — after surging almost 2% to an all-time peak on Thursday — as the dollar extended declines ahead of a widely expected Federal Reserve rate cut next week.
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Bullion climbed as much as 0.4% to $2,568.06 an ounce on Friday, and was on track for a weekly gain of almost 3%. The metal moved up sharply in the previous session after the euro pushed higher against the greenback as investors pared bets that the European Central Bank, which lowered rates on Thursday, would cut again next month.
The precious metal has surged by almost a quarter this year, supported by growing optimism the Fed will pivot to monetary easing. Robust over-the-counter purchases, central-bank buying, and strong haven demand due to conflicts in the Middle East and Ukraine have helped the advance. There are also now growing signs of a pick-up in retail investor interest.
Spot gold rose 0.2% to $2,563.63 at 9:36 a.m. in Singapore, after surging 1.8% on Thursday. The Bloomberg Dollar Spot Index fell 0.2%, adding to a 0.4% loss in the previous session. Silver, palladium and platinum all climbed.
The market was also weighing two US data points released Thursday that showed faster-than-forecast inflation and an uptick in applications for unemployment benefits. The figures did little to alter bets that the Fed will go ahead with its much-anticipated pivot next week. Lower borrowing costs typically benefit the non-yielding precious metal.
Investors buying back their previously built bearish wagers in gold may have also contributed to the metal’s ascent. Money managers’ gross short positions in Comex gold futures stood at the highest in four weeks in the week ending Sept. 3, according to the latest CFTC data.
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