Gold Hits All-Time Highs Amid US Government Shutdown

Gold prices in local and global markets surged to their highest levels ever during Wednesday's trading, as the US government entered its first shutdown in nearly seven years after lawmakers failed to reach an agreement on government funding. This is according to a report issued by "iSagha" platform, specializing in gold and jewelry trading.

Price Movements Locally and Globally

Said Embaby, CEO of "iSagha" platform, stated that gold prices rose by approximately EGP 60 during today's trading compared to yesterday's close, with a 21-carat gram reaching EGP 5240. Globally, the ounce climbed by about $30 to $3888, after touching $3900 in the morning as its highest price in history.

He added that the 24-carat gold gram recorded EGP 5989, 18-carat reached EGP 4491, and 14-carat reached EGP 3487, while the price of a gold pound stabilized at EGP 41920.

A Rising Global Scene Despite Temporary Declines

Gold prices surged to historical peaks on Wednesday with the start of the government shutdown in the United States after the failure to pass the new fiscal year funding bill. Although the impact of shutdowns is usually limited on markets, the timing of the current shutdown is critical; it is likely to delay the release of US jobs data scheduled for Friday, casting a shadow of uncertainty over Federal Reserve expectations weeks before its next meeting.

US President Donald Trump also threatened to use the shutdown to lay off a "large number" of federal employees, who are usually furloughed temporarily during the shutdown period and then return to work after it ends. The duration of the shutdown remains unclear in the absence of a decisive negotiation path; notably, his first term saw a partial shutdown lasting 34 days, the longest in history.

In this ambiguous climate, high-risk assets came under pressure, while gold—as a safe haven in times of economic and geopolitical turmoil—continued its upward trajectory, recording a new record high this year.

Labor Data and the Dollar: Renewed Pressures

A report issued by "ADP" a short while ago showed that the number of jobs in the US private sector decreased by 32,000 in September, and annual wages increased by 4.5% year-on-year.

The reading followed a decrease of 3,000 jobs (adjusted from +54,000) in August, and was lower than market expectations of 50,000 jobs.

Dr. Nela Richardson, chief economist at ADP, commented: "Despite strong economic growth in the second quarter, this month's release shows what we have observed in the labor market: employers are more cautious in hiring."

Concurrently, the US dollar experienced a selling wave after the disappointing data; the dollar index fell by 0.27% during the day to 97.53, before later hovering near 97.80, which supported gold's attractiveness to non-US buyers.

Will Gold Reach $4000?

Gold's status as a safe haven gained increasing coverage as its gains accelerated to historical peaks today. Although the direct catalyst for Wednesday's session is the US government shutdown, the risk landscape extends to two ongoing major conflicts, political instability in France, and new tariff announcements; all factors that paint an unstable picture for investors, driving them to resort to gold.

Recent research notes suggest that the yellow metal could surpass $4000 per ounce, driven by purchases from central banks, individual investors, and institutions. In a Wednesday morning note, Joni Teves, a strategist at UBS, argued that gold remains "under-owned" by investors, expecting the rally to continue in the coming quarters as gold holdings broaden and the Federal Reserve begins an easing cycle—meaning a weaker dollar and lower real interest rates as supporting factors.

UBS expects the pace of ascent to slow by the end of 2026 in anticipation of the end of the easing cycle and improving economic conditions. However, with the structural shift that has made gold an essential part of strategic asset allocations, any subsequent correction is expected to be contained, and prices are projected to stabilize at higher historical levels in the long term.

Week's Agenda and Monetary Policy Outcomes

Investors this week are monitoring JOLTS job vacancy data, private sector employment, the ISM manufacturing index, and non-farm payrolls (NFP) data—data that may be delayed due to the shutdown. The ambiguity of the scene has strengthened easing bets; the CME FedWatch tool shows that traders estimate a 25 basis point cut at the October meeting at 95%, with a 78% probability of another cut in December.

Politically-monetarily, Susan Collins, President of the Federal Reserve Bank of Boston, said that "a slight rate easing this year may be appropriate if data confirm it," while Lorie Logan, President of the Federal Reserve Bank of Dallas, warned of "relatively limited margins for further cuts," while Vice Chairman Philip Jefferson avoided giving a decisive signal by saying that "both sides are under pressure."

Shutdown Background: Procedural Details and Expected Impacts

The US government officially entered a shutdown on Wednesday morning after Congress failed to pass a bill to fund the new fiscal year. The Republican-majority House of Representatives had approved a temporary measure offered at the last minute for a Senate vote on Tuesday, but it only garnered 55 votes against the 60 required to proceed.

This deadlock places hundreds of thousands of federal employees between furlough or working without pay, and threatens to delay the release of key economic data—including weekly jobless claims on Thursday and "non-farm payrolls" on Friday—which increases pressure on the already weak dollar and improves the terms of demand for gold for foreign investors.

Gold's historical peak coincides with a political-financial shock in the United States that weakens the dollar and intensifies uncertainty, while local figures reflect strong gains during September and a positive start to the last quarter of the year. As the debate approaches the $4000 per ounce level in light of central bank purchases and monetary easing bets, the paths remain dependent on the pace of US data releases and developments of the government shutdown in the coming days.