BENGALURU (Sept 30): Gold eased from its recent record high on Monday, but was still set for its biggest quarterly gain in more than eight years on the back of geopolitics and the US Federal Reserve's (Fed) rate cut.
Spot gold was down 0.3% to US$2,648.88 per ounce as of 1010 GMT and US gold futures rose 0.1% to US$2,671.00.
Bullion has risen 14% so far this quarter, its best since January 2016. It is up nearly 6% this month, after reaching a record high of US$2,685.42 on Thursday, fuelled by the Fed's half-percentage-point cut, China's initiation of stimulus measures, and escalating conflict in the Middle East.
"We look for the next move higher to come from ETF investors, holdings of which are still well below the peak," UBS analyst Giovanni Staunovo said.
"Weaker US economic data should allow the Fed to cut further and allow gold to rise to US$2,900 per ounce over the next 12 months."
Investors are looking ahead this week to US ADP employment statistics and non-farm payrolls data later this week. Speeches from Fed Chair Jerome Powell and Governor Michelle Bowman later in the day could shed some light on the policy outlook.
Analysts said bullion's gains on Monday were restricted on some profit-taking and a boost to risk sentiment after Chinese shares were poised for their best day in 16 years.
Recent strength in Chinese stocks might suggest a scaling back in gold positions on the fringe, said independent analyst Ross Norman.
When risk appetite rises, investors shy away from gold, typically seen as a safe-haven asset in uncertain times.
Among other metals, spot silver was down 0.6% at US$31.43 per ounce, after hitting a 12-year high last Thursday and is set for quarterly rise of 8%, its fourth consecutive gain.
"If monetary policy continues to loosen as expected, this could help silver continue this uptrend," said Kinesis Money market analyst Carlo Alberto De Casa in a note.
Platinum shed 1.3% to US$986.93. Palladium declined 0.4% to US$1,006.94, but was headed for a quarterly gain.
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