Gold prices have reached a new record high, surpassing $3,839 an ounce, amid rising concerns over a potential U.S. government shutdown. This marks a 46 percent increase in gold’s value this year, positioning it for the best annual performance since 1979. Meanwhile, U.S. Treasuries have remained stable after previous gains. The dollar saw a slight uptick following President Donald Trump’s implementation of a 10 percent tariff on softwood timber and lumber imports into the United States.
In Asia, shares reflected a modest rise of 0.2 percent, indicating a potential sixth consecutive month of gains, the longest streak since 2018. Zijin Gold International Co. experienced a dramatic increase of 66 percent during its trading debut in Hong Kong, while equity fluctuations characterized the broader greater China market, which is on track for its most significant month of gains in seven years.
Vice President JD Vance expressed concerns that the U.S. government may face a shutdown after a recent meeting between President Trump and top congressional leaders failed to address Democrats’ requests ahead of the October 1 deadline.
Investors are apprehensive about how a shutdown could impede critical data releases that are essential for assessing the health of the U.S. economy. This includes the upcoming nonfarm payrolls report, which will provide insight into the labor market and influence the Federal Reserve’s decisions on interest rate cuts.
Kathy Jones, chief fixed income strategist at Charles Schwab & Co., stated, “Given the importance of the job market to the Fed’s rate-cutting decisions, the risk that the September unemployment report could be delayed could add to the market’s anxiety over the direction of policy.”
Emerging-market assets began the week on an upward trajectory, as concerns regarding a possible shutdown exerted pressure on the dollar. The yield on the U.S. Treasury 10-year note fell to 4.14 percent, as such shutdowns historically correlate with gains in bonds, owing to their potential to dampen economic growth.
However, market reactions do not indicate an immediate retreat from risk, as past experiences of U.S. shutdown threats provide some reassurance, according to Vishnu Varathan, head of macro research for Asia ex-Japan at Mizuho Securities in Singapore. He noted, “Experience provides some consolation of narrowly averting shutdowns or at least disaster from previous episodes. Crucially, markets fully expect that dysfunctional bipartisan dynamics will necessarily accentuate political brinksmanship.”
Bloomberg strategists suggest that gold’s recent gains have largely gone unnoticed, as record highs are becoming commonplace. However, Monday’s 2 percent rise from high levels indicates prevailing concern about the risks posed by a potential shutdown, while also suggesting that gold could dramatically drop should the U.S. avoid a shutdown.
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Published on September 30, 2025.
