By Atoyebi Nike
Gold prices soared to a fresh record on Tuesday, the dollar weakened, and global stock markets traded mixed as investors braced for a possible US government shutdown that could disrupt the release of key economic data.
Talks between President Donald Trump and congressional leaders failed to bridge differences ahead of a midnight deadline, with Senate Democrat Chuck Schumer warning of “large differences” and Vice President JD Vance accusing Democrats of holding the public “hostage” with funding demands.
Gold climbed above $3,871 an ounce nearly 50 percent higher since the start of the year with analysts speculating it could soon hit $4,000. “In trading rooms, gold is no longer just a hedge; it’s become the star performer, the undisputed heavyweight,” said Stephen Innes of SPI Asset Management.
While shutdowns are usually short-lived, Neil Wilson of Saxo Markets cautioned that deep political divides could make this one longer and more damaging. The 2018-2019 shutdown lasted 35 days, during which the S&P 500 dropped 14 percent.
A prolonged standoff could also delay crucial labour market data expected this week, further clouding the Federal Reserve’s path on interest rates. Investors already expect two more cuts this year after the Fed lowered borrowing costs for the first time since December.
Oil prices continued to slide, extending Monday’s three-percent drop amid fears of oversupply and possible OPEC+ output hikes at Sunday’s meeting.
