Gold prices hit a record high of $2,588.95 per ounce on Monday, buoyed by a weakening dollar and market expectations that the Federal Reserve will cut interest rates this week for the first time since 2020, with a possible reduction of 50 basis points. "The prospect of a 50-basis point rate cut this week from the Fed is leading to an inverse relationship between gold and the dollar," said Tim Waterer, chief market analyst at KCM Trade. "The overall picture for gold remains favorable and it could rise further. If the dollar continues to decline, gold prices could reach $2,700 per ounce by year-end."

All eyes will be on the Fed this week, with increasing speculation about the magnitude of a potential rate cut at its September 17-18 monetary policy meeting, and the pace of future rate cuts. According to the CME FedWatch tool, the market is currently pricing in a 59% probability of a 50 basis point rate cut on Wednesday, up from 43% on Friday. (Gold Ten)