Gold Prices Hit New Record Highs as US PPI Data Supports Fed Rate Cut Expectations

Spot gold extended its daily gain by 1.7% in the US trading session, hitting a new record high of $2,555.16 per ounce. This comes after the latest U.S. inflation data further boosted expectations that the Federal Reserve will cut interest rates by 25 basis points next week. Paul Ashworth, an analyst at Capitol Macro, said in a report, ‘August's PPI data provided more encouragement to the Fed that inflation is under control.’ Meanwhile, the dollar weakened against a basket of major currencies after the European Central Bank cut its benchmark interest rate for the second time in three months in response to falling inflation.