Gold prices rose in European trading on Tuesday, extending gains for the third consecutive session and reaching a three-week high, supported by strong investment demand for the precious metal as a safe-haven asset, especially amid expectations of a potential US interest-rate cut in December.

However, gains were capped by the continued strength of the US dollar in foreign-exchange markets, following the Senate’s approval of a preliminary agreement to end the longest government shutdown in US history.

Price Overview

• Gold prices rose 0.8% to $4,149.02 an ounce — the highest since October 23 — from an opening level of $4,115.06, after touching an intraday low of $4,114.94.

• On Monday, gold settled 2.9% higher, marking its second consecutive daily gain and the largest single-day rise since October 16, boosted by active demand for the metal.

US Dollar

The US Dollar Index rose 0.15% on Tuesday, holding gains for a second straight session and reflecting continued strength in the greenback against a basket of global currencies.

The dollar’s rise came as markets anticipated an imminent end to the US government shutdown, after the Senate on Monday evening passed an agreement to restore federal funding and conclude the record-long closure.

The bill now moves to the House of Representatives, where Speaker Mike Johnson said he aims to approve it on Wednesday and send it to President Donald Trump for signature into law.

US Interest Rates

• A survey released Friday showed that US consumer confidence fell to its lowest level in nearly three and a half years in early November, amid concerns over the economic impact of the prolonged government shutdown.

• Federal Reserve Governor Steven Miran said Monday that a 50-basis-point rate cut would be appropriate for December, noting that inflation is easing while unemployment continues to rise.

• According to CME Group’s FedWatch tool, markets currently price in a 63% chance of a 25-basis-point rate cut in December and a 37% chance of rates remaining unchanged.

• To reassess these expectations, investors are closely monitoring comments from Fed officials, with government data releases expected to resume as early as Thursday.

Outlook for Gold

Market strategist Ilya Spivak said the perception that the government shutdown is nearing its end has been interpreted as a removal of one layer of uncertainty, giving markets permission to return to one of this year’s dominant speculative narratives.

He added that the broader trend for the remainder of the year remains upward and that, at this stage, the path of least resistance for gold appears to be a return to its October high — with potential for further gains beyond that level.

SPDR Holdings

Holdings in the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, were unchanged on Monday at 1,042.06 metric tons — the highest level since October 24.

The British pound declined in European trading on Tuesday against a basket of global currencies, retreating from its two-week high against the US dollar and heading for its first loss in five sessions, as profit-taking and corrective moves weighed on the market.

The currency also came under pressure after gloomy UK labor-market data showed a slowdown in economic activity, reinforcing expectations that the Bank of England may cut interest rates in December.

Price Overview

• GBP/USD fell 0.4% to 1.3120 from an opening level of 1.3174, after touching an intraday high of 1.3178.

• On Monday, the pound gained around 0.1% against the dollar, marking a fourth consecutive daily rise and hitting a two-week high at 1.3191.

UK Labor Market

Data from the Office for National Statistics showed jobless claims in Britain rose by 29,000 in October — the highest increase since July 2024 and well above market forecasts of 17,600, following a 25,800 rise in the previous month.

The unemployment rate climbed to 5% in September, the highest since April 2021, compared with expectations of 4.9% and a prior reading of 4.8%. Wage growth slowed to 4.8% in September from 5.0% in August, falling short of expectations for a 5.0% increase.

These figures highlight the clear weakness in the UK labor market, easing pressure on Bank of England policymakers and strengthening the case for a rate cut in December.

UK Interest Rates

• Following the data, market pricing for a 25-basis-point rate cut by the Bank of England in December rose from 60% to 80%.

• Investors are now awaiting further key data releases on growth and inflation in the UK to reassess those expectations.

The Japanese yen fell in Asian trading on Tuesday against a basket of major and minor currencies, extending its losses for the third consecutive session against the US dollar and hitting its lowest level in nine months, as the greenback strengthened amid optimism over the nearing end of the longest government shutdown in US history.

The yen also came under additional pressure from comments by Prime Minister Sanae Takaichi, who signaled the start of a new phase of fiscal stimulus policies aimed at supporting Japan’s weak economic growth.

Price Overview

• USD/JPY rose by 0.25% to ¥154.49 — its highest since February — from an opening level of ¥154.13, after recording a session low at ¥154.04.

• The yen closed Monday down 0.5% against the dollar, marking a second straight daily loss following Takaichi’s statements.

US Dollar

The US Dollar Index rose around 0.1% on Tuesday, holding gains for a second consecutive session and reflecting continued strength in the greenback against a basket of global currencies.

The advance came as markets anticipated an imminent end to the US government shutdown, particularly after the Senate passed an agreement late Monday that would restore federal funding and bring an end to the record-long shutdown.

The agreement now moves to the House of Representatives, where Speaker Mike Johnson said he intends to hold a vote on Wednesday and send the bill to President Donald Trump for his signature to make it law.

Sanae Takaichi

Late last week, Prime Minister Sanae Takaichi sparked wide debate in Japan’s economic circles after announcing that her government intends to abandon its current annual fiscal target in favor of a new multi-year spending goal.

This shift means Tokyo will move away from its previous commitments to achieving a balanced budget by a fixed annual deadline — a move seen as loosening the long-standing fiscal discipline maintained by past administrations.

Takaichi justified the change by arguing that the annual framework is no longer suitable amid Japan’s multiple economic challenges — including weak growth, slowing industrial output, and rising living costs — emphasizing that the new approach will grant the government greater flexibility to manage fiscal policy over a longer horizon.

Analysts believe the move could pave the way for a new phase of expansionary fiscal policy to support growth, though it simultaneously presents new challenges for the Bank of Japan as it seeks to align its monetary stance with a looser fiscal framework.

Interest Rate Outlook in Japan

• Market pricing currently assigns around a 50% probability that the Bank of Japan will raise interest rates by 25 basis points at its December meeting.

• Investors are awaiting further data on inflation, unemployment, and wage levels in Japan to reassess those expectations.

Ripple prices surged sharply on Monday as optimism grew over the potential end of the US government shutdown and positive funding news from Ripple Labs.

**US Senate makes progress on ending government shutdown**

Risk appetite strengthened on Monday after the US Senate voted to advance a bill that would fund the government through January 30, 2026.

The motion passed 60 to 40, with eight Democratic senators joining Republicans in support of the measure.

A full Senate vote on the bill is expected soon.

Ending the shutdown – the longest in US history – is expected to improve sentiment toward the world’s largest economy, particularly as the government resumes releasing key economic data.

It could also help ease concerns about the shutdown’s economic impact, which is estimated to have cost the US tens of billions of dollars over the past month.

Ripple jumps on optimism over company funding

Ripple was among the strongest-performing altcoins, rising more than 8% to $2.4570.

The rally came amid optimism following Ripple Labs’ announcement that it had secured $500 million in new funding, valuing the company at $40 billion.

This comes after Ripple denied recent speculation about plans for an initial public offering.

Prices were also supported by expectations that the company might use part of the new capital to repurchase XRP tokens — a move seen as positive for investors and supportive of further price gains.

As of 21:02 GMT, XRP surged 9.6% to $2.56 on CoinMarketCap.