The US government shutdown has pushed gold prices to a historic high above $3,900 per ounce, while global markets show mixed reactions.
Gold Prices Break Records
On October 1, as federal institutions in the United States halted operations due to Congress’s failure to approve a new budget, gold once again rewrote its record. December COMEX futures surpassed $3,900 per ounce for the first time in history, trading at $3,915.1 by 13:21 Moscow time. Analysts note that the shutdown has driven renewed demand for the safe-haven asset, with projections of a possible climb to $4,000, although concerns of short-term overbought conditions remain.
Dollar and Volatility Index
The US Dollar Index (DXY) held steady at 97.833 points, while the VIX fear index rose 2.89% to 16.76 points, reflecting heightened nervousness among investors. Analysts warn that prolonged suspension of federal operations could put further pressure on the dollar and delay critical economic reports, including the nonfarm payrolls data, which the Federal Reserve considers in interest rate decisions.
US Stock Futures Fall
US futures signaled caution ahead of market opening. By 13:23 Moscow time, futures on the S&P 500 fell 0.51% to 6,704.25 points, NASDAQ futures dropped 0.59% to 24,755.5, and Dow Jones futures declined 0.46% to 46,472 points.
Oil Prices Under OPEC Pressure
Brent crude December futures slipped 0.23% to $65.88 per barrel. Oil prices have been trading between $65–70 since August but remain influenced by expectations surrounding OPEC+ decisions. The group is set to meet on October 5 to discuss easing production limits, with a possible increase of 500,000 barrels per day over three months.
Russian and European Markets React Differently
The Moscow Exchange Index slipped 0.14% to 2,680.84 points, weighed down by geopolitical uncertainty and lack of clarity on the central bank’s rate trajectory. In contrast, European markets opened higher: Germany’s DAX gained 0.4%, the UK’s FTSE 100 rose 0.71%, and France’s CAC 40 added 0.35%.
What is a US Government Shutdown?
A shutdown occurs when Congress fails to pass a funding bill, cutting off financing for federal agencies. Non-essential employees are sent home without pay, while critical workers—including healthcare staff, border agents, military personnel, and transportation staff—must work without immediate compensation. The current shutdown, effective October 1 at 00:01 Eastern time, is the first in nearly seven years and the 15th since 1981. The longest shutdown lasted 35 days during Donald Trump’s presidency in 2018–2019. This suspension will impact air travel, scientific research, military pay, and affect 750,000 federal employees, with estimated daily losses of $400 million in compensation.
