Gold extended its gains, reaching a near three-week high on Tuesday, driven by rising expectations of an additional interest rate cut by the U.S. Federal Reserve in December, which boosted demand for this safe-haven asset. Spot gold increased by 0.4% to $4,131.83 per ounce as of 0053, marking its highest level since October 24. U.S. gold futures for December delivery increased by 0.4%, reaching a price of $4,138.70 per ounce. Last week, data indicated that the U.S. economy experienced job losses in October, particularly within the government and retail sectors. U.S. consumer sentiment declined to its lowest level in three and a half years in early November, reflecting concerns regarding the economic repercussions of the longest government shutdown in U.S. history, according to a survey released on Friday.

Market participants are estimating a roughly 64% chance that the U.S. central bank will execute a 25 basis point rate cut in the coming month, according to the reports. Fed Governor Stephen Miran indicated on Monday that a 50-bps rate cut would be appropriate for December, emphasizing the drop in inflation along with an increasing unemployment rate. Gold, which does not generate interest, usually shows strong performance in settings marked by low interest rates and times of economic uncertainty. The U.S. Senate on Sunday advanced a proposal aimed at reopening the federal government and ending a shutdown that has lasted for 40 days, impacting federal employees, delaying food assistance, and disrupting air travel.

Should the Senate approve the bill designed to finance the government until January 30, which encompasses a trio of full-year appropriations measures, it will subsequently require the endorsement of the House of Representatives before being forwarded to President Donald Trump, a procedure that may extend over several days. China’s gold consumption in the first three quarters of 2025 saw a slower decline compared to the previous year, supported by strong safe-haven interest that maintained investment demand, despite high prices impacting jewellery purchases. The consistent demand from Asian markets, particularly from investors seeking to hedge against global uncertainty, continues to provide a stabilizing influence on gold’s overall momentum.

Elsewhere, spot silver firmed 0.2% to $50.66 per ounce, platinum rose 0.3% to $1,582.60, and palladium added 0.8% to $1,425.71. The collective uptrend across precious metals reflects broad investor confidence in the sector, as expectations for easing monetary policies and ongoing geopolitical concerns enhance safe-haven appeal. The sustained rise in gold and its peers suggests continued bullish sentiment heading into December, with markets closely monitoring central bank signals and fiscal developments that could determine the trajectory of precious metals in the weeks ahead.