Precious Metals Soar Ahead of September Fed Meeting

 

Precious Metals Soar Ahead of September Fed Meeting

(Bullion News Network) – Gold rocketed to yet another all-time high on Monday, closing nearly $50 higher at over $3,630 per troy ounce. The spot price of silver also increased to begin the week, climbing by over $0.30/ozt to inch within just a few cents of $41.50 per troy ounce. The price action favored gold, driving the gold-silver ratio for a fifth consecutive day. The GSR is set to close the day over 0.5 points higher to over 87.75:1. Platinum group metals also ended Monday in the green, with platinum jumping by over $10 and palladium adding more than $27 to its spot price per troy ounce. Rate cut speculation continued to be a major market driver for safe haven assets on Monday, as the FOMC is expected to cut interest rates by at least 25 basis points when it meets next week. 

Another troubling job market report released last week bolstered the odds of a September rate cut. As of Monday, CME FedWatch projects a 100% probability that the FOMC will cut rates in September, with an 88.4% chance of a 25 basis point cut and an 11.6% probability that the committee will instead opt for a larger 50 bps cut. Wall Street retreated at the end of last week following the worse-than-expected employment report, but markets rallied to record heights Monday ahead of an anticipated interest rate cut. 

Safe haven assets like gold and silver tend to thrive in periods characterized by falling interest rates, since cutting rates is typically an inflationary action. Rate cut speculation drove gold to multiple all-time highs in 2024, although a lack of rate cuts from the Fed in 2025 has placed interest rate cut speculation in the backseat as economic and geopolitical uncertainty pushed safe haven assets higher throughout the year. In August and September 2025, growing speculation that the Fed will finally cut rates at its September meeting drove precious metal prices to new heights.

Last month, Federal Reserve Chair Jerome Powell told reporters that the FOMC may find itself in a difficult position where its two goals, keeping prices stable and employment high, are at odds with one another. On Thursday, traders will be able to review a fresh inflation reading with the August Consumer Price Index (CPI) report. This will be the last inflation data the Fed is able to review before it meets next Wednesday, so markets will be on high alert to see how the numbers play for the FOMC’s apparent plans to pull the lever on a fresh rate cut.

Gold, silver, platinum, and palladium prices all jumped on Monday as traders bet big on a rate cut from the Federal Reserve. The gold-silver ratio ended marginally higher as gold set a fresh all-time high and silver prices reached their highest point since 2011.