Gold maintained its remarkable ascent on Friday, exceeding $4,300, positioning itself for its most robust weekly performance in 17 years. This movement was propelled by escalating U.S.-China trade tensions that intensified market uncertainty, coupled with increasing anticipations of a U.S. rate cut that fueled the upward trajectory. Spot gold rose by 0.9% to $4,364.79 per ounce, as of 0040, after reaching a high of $4,378.69. Bullion has risen by 8.7% this week, marking its most robust weekly performance since September 2008.

U.S. gold futures for December delivery rose by 1.6% to $4,373.20. Spot silver rose by 0.5% to $53.97 per ounce, after reaching a high of $54.35 earlier, driven by an increase in gold prices and a short squeeze in the spot market, positioning it for weekly gains. The U.S. dollar index experienced a decline, reaching a level not observed in more than a week, which led to a decrease in the prices of bullion denominated in dollars. The price of non-yielding bullion has surged over 65% this year, driven by geopolitical tensions, anticipations of substantial rate cuts, central bank acquisitions, de-dollarisation trends, and robust inflows into ETFs. Market sentiment experienced significant influence from U.S.-China trade tensions, as China attributed the incitement of panic over its rare earth controls to the U.S. and rejected appeals to ease export restrictions.

Federal Reserve Governor Christopher Waller on Thursday indicated his support for a further rate cut, citing concerns regarding the labor market. Investors are expecting a 25-basis-point reduction at the Fed’s upcoming meeting on October 29-30, with another anticipated in December. The SPDR Gold Trust, recognized as the largest gold-backed exchange-traded fund in the world, announced a 1.18% rise in its holdings to 1,034.62 tonnes on Thursday, marking the highest level since June 2022 when compared to Wednesday.

U.S. President Donald Trump and Russian President Vladimir Putin reached an agreement on Thursday for an additional summit concerning the conflict in Ukraine. Western nations maintained their pressure on Russia concerning its oil sales, as Britain enacted sanctions targeting major Russian oil companies. The U.S. budget deficit has contracted by $41 billion, bringing it down to $1.775 trillion for the 2025 fiscal year. In other markets, platinum saw an uptick of 0.4%, reaching $1,719.55, whereas palladium experienced a gain of 0.6%, climbing to $1,622.67. Both of these metals were poised for a weekly gain.