Gold Hovers Below All-Time High as US Election Gets Underway

Gold held steady as US election day begins, with a Federal Reserve interest rate decision also due later this week.

Bullion was near $2,740 an ounce, just shy of the all-time high set last week. While prices have been relatively stable so far on Tuesday, previous US elections have seen sharp swings. With polls suggesting a photo-finish result, the risk of a disputed outcome means that the vote count could drag on for days or even weeks.

Meanwhile, the Fed and some of its rich-world peers are expected to lower borrowing costs later this week. Lower rates are often seen as supportive for gold, which doesn’t pay interest.

Gold has surged by more than 30% so far this year, aided by expectations of Fed rate cuts, central-bank buying and haven demand amid conflicts in the Middle East and Ukraine. Uncertainty around the tight US presidential race has also supported the yellow metal.

“A Trump victory would likely result in a rising gold price,” according to a report from Commerzbank AG. “By contrast, a Harris victory would put gold under pressure. Should the election result be uncertain for days or even weeks, gold would benefit from the resulting uncertainty.”

The latest data showed the US service sector expanded in October at the fastest pace in over two years, with the Institute for Supply Management’s employment index climbing to the highest since August 2023. Further job gains, paired with low unemployment and limited layoffs, painted a more resilient labor market picture than offered by last week’s monthly jobs report. 

Spot gold was little changed at $2,736.98 an ounce at 10:42 a.m. in New York. The Bloomberg Dollar Spot Index edged lower, while the US 10-year Treasury yield gained. Palladium, platinum and silver all climbed.

With assistance from Yvonne Yue Li.

This article was generated from an automated news agency feed without modifications to text.