The price of gold on Tuesday surged past $4,000 an ounce for the first time, driven by expectations of another Federal Reserve rate cut this month and persistent safe-haven demand due to the continuing US government shutdown.
US gold futures for December delivery settled 0.7 per cent higher at $4,004.4, after hitting a high of $4,014.6.
Spot gold was up 0.6 per cent to $3,985.82 an ounce as of Tuesday afternoon, after hitting an all-time high of $3,990.85 earlier in the session.
The primary market for spot gold is the London over-the-counter market, which is the global benchmark for pricing.
"It's ongoing safe-haven flows stemming in part from the government shutdown and no real indication that is likely to be resolved in the immediate term here. So there's still a pretty decent bid in gold," said Peter Grant, vice president and senior metals strategist at Zaner Metals.
Non-yielding gold, which tends to do well during times of uncertainty and low interest rates, has climbed 51 per cent so far this year.
The metal's rally has been driven by a mix of factors, including expectations of interest rate cuts, continuing political and economic uncertainty, solid central bank buying, inflows into gold ETFs and a weak dollar.
The US government shutdown entered its seventh day on Tuesday. It has postponed the release of key economic indicators, forcing investors to rely on secondary, non-government data to gauge the timing and extent of Fed rate cuts.
Investors are now pricing in a 25-basis-point cut at the Fed meeting this month, with another 25-basis-point cut anticipated in December.
