Gold prices rose to an all-time high on Monday, supported by a weaker dollar and growing expectations that the Federal Reserve is likely to continue with interest rate cuts later this year.
Spot gold was up 0.8 percent at US$3,789.39 per ounce as of 0251 GMT, after hitting a record high of US$3,798.32 (HK$29,626.9) earlier in the session.
U.S. gold futures for December delivery rose 0.3 percent to US$3,818.30.
The U.S. dollar index eased 0.2 percent against its rivals, making greenback-priced bullion less expensive for overseas buyers.
The U.S. Commerce Department said on Friday its Personal Consumption Expenditures Price Index (PCE) rose 0.3 percent in August, versus the prior 0.2 percent rise in July, matching the estimate of economists polled by Reuters.
"That benign inflation print in the United States has given the markets reason to believe further Fed cuts are coming in October and December," said Capital.com analyst Kyle Rodda.
"Sentiment is very bullish and we are on track to retest another record high this week. The gold market is positioned quite long at the moment and that may be pointed to as being a
reason to be cautious about future upside."
Traders are currently pricing in a 90 percent chance of a Fed cut in October, with around a 65 percent probability of another in December, according to CME FedWatch Tool.
Safe-haven bullion thrives in a low interest-rate environment and in times of geopolitical and economic uncertainty.
Share markets got off to a cautious start in Asia on Monday as investors braced for a possible shutdown of the U.S. government.
Investors now await U.S. data on job openings, private payrolls, the ISM manufacturing PMI and Friday's non-farm payrolls report for further clues on the economy's health.
SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 0.89 percent to 1,005.72 tonnes on Friday from 996.85 tonnes on Thursday.
Elsewhere, spot silver rose 1 percent to US$46.47 per ounce, platinum climbed 2.6 percent to US$1,608.90 and palladium gained 1.4 percent to US$1,287.19.
REUTERS
