U.S. Government Shutdown Enters Seventh Day with No Resolution in Sight, Traders Still Expecting Two More Fed Rate Cuts This Year

On October 7th, against the background of the seventh day of the U.S. government shutdown with no indication of a resolution, the price of gold slightly retreated during early trading after approaching the $4,000 per ounce level. The U.S. government shutdown has introduced more uncertainty to the financial markets, resulting in a delay in the release of U.S. economic data that is crucial for the Federal Reserve's decision-making. Nevertheless, traders still anticipate that the Fed will cut interest rates twice more this year. Meanwhile, political unrest in France and ongoing geopolitical risks continue to boost the demand for safe-haven assets. Goldman Sachs has increased its gold price forecast for December 2026 from the previous $4,300 per ounce to $4,900 per ounce, citing factors such as inflows into gold exchange-traded funds and central banks' gold purchases. (Fx678)