Gold is trading more than 2% higher in midday European trading on Monday, November 10th, the opening session of the week, reaching its highest level in two weeks. This comes despite positive news of the end of the US government shutdown and rising market expectations of a Federal Reserve interest rate cut in December. Markets are also awaiting US inflation figures due next Thursday. Gold is trading up approximately 2.01% at $4,079 per ounce, while silver is trading at $49.74 per ounce, up 2.79%.

US media sources announced this morning that Republican and Democratic members of the Senate have agreed on a bill to fund the government until January 30th, temporarily ending the US government shutdown, the longest in history, which began in early October. This has boosted risk appetite in the markets. Some indicators and statements from Federal Reserve members have revealed concerns about the weakness of the US labor market, raising market expectations of a Federal Reserve interest rate cut in December. Markets are pricing in a 65% probability of a 25-basis-point rate cut in December, according to the CME FedWatch tool.

US consumer confidence data from the University of Michigan, released at the end of last week’s trading for November, fell to its lowest level in three years, dropping 6% to 50.3 points, compared to 53.6 in October. Expectations had anticipated a reading of 53 points.

Factors supporting the rise in the price of gold include increased purchases by central banks and individuals, as gold remains a key safe-haven asset. The People’s Bank of China continued to increase its gold reserves for the twelfth consecutive month in October, while inflows into gold-backed exchange-traded funds (ETFs) also continued. The SPDR Gold Trust, the largest gold-backed ETF, announced that its holdings rose by 0.6% to 1,042.06 metric tons on Friday. Platinum, in turn, is trading at $1,568, up 1.53%, while palladium is up about 1.29%, trading at $1,398.