• Gold breaks to new record highs on Friday as central banks worldwide are expected to follow the Fed’s example. 
• The precious metal shot to a new high after the Fed’s decision to slash borrowing costs by 0.50% on Wednesday. 
• As traders say, the “trend is your friend,” and technically, Gold is in a strong uptrend in all time frames. 

Gold (XAU/USD) breaks to a new record high near $2,610 on Friday on heightened expectations that global central banks will follow the Federal Reserve (Fed) in easing policy and slashing interest rates. Lower interest rates are positive for Gold, as they reduce the opportunity cost of holding the non-interest-paying asset, making it more attractive to investors.

Following Wednesday’s Fed decision, the South African Reserve Bank (SARB) cut its key interest rate by 25 basis points (bps) on Thursday – the first cut since the Covid pandemic in 2020. The Central Bank of the Philippines cut interest rates by 250 bps to 7.0% at its meeting on Friday. The Reserve Bank of India (RBI) is now also widely expected to slash interest rates in sympathy with the Fed when it next meets.

Although the People’s Bank of China (PboC) kept its key lending rates unchanged at the September fixing on Friday, the one and five-year loan prime rates lie at record lows of 3.35% and 3.85%, respectively, after the bank made a surprise cut in July. The Bank of Japan (BoJ), meanwhile, left rates unchanged at its meeting on Friday, despite some speculation of a rate hike in the offing.