Gold prices have rallied to record highs, with global attention focused on the Federal Reserve's upcoming interest rate cut

Spot gold rallied to a new all-time high above $2,550 on Sept. 12, after US inflation figures were again higher than expected and initial jobless claims rose, confirming bets that the Federal Reserve would cut interest rates next week. "The combination of ECB interest rate cuts, a small increase in initial jobless claims and PPI was enough to push gold to a new all-time high," said Ole Hansen, head of commodity strategy at Saxo Bank. After Wednesday's announcement of a pick-up in CPI for August, swap dealers cemented their bets on a 25 basis point cut by the Federal Reserve at next week's meeting. Hansen added that the start of the rate-cutting cycle could add support for the gold market, regardless of the rate cut. Gold prices have risen by more than a fifth this year, supported by growing expectations that the US Federal Reserve will soon begin a rate-cutting cycle. Strong central bank buying and strong demand over the counter have also fuelled the rally.