Gold prices hit record high on US rate-cut hopes…North Korea·China·Russia leaders together [Morning Briefing]

◆ 'Gold rally' on rate-cut hopes

With U.S. markets closed for Labor Day (Labor Day·the first Monday of September) on Sept. 1 local time, expectations of a policy rate cut pushed gold futures prices to an all-time high. On the New York Mercantile Exchange, the front-month gold futures price rose to $3,557.1 per ounce around 3 a.m. Eastern Time, marking the highest level in about four months since April. Expectations grew that the U.S. central bank (the Federal Reserve·Fed) will cut the policy rate at the Federal Open Market Committee (FOMC) meeting on Sept. 16–17, leading to the gold-price rally. Investors' preference for safe-haven assets was also heightened amid concerns that President Donald Trump's repeated pressure for rate cuts could undermine the Fed's independence.

◆ U.S. Treasury official who said "The Fed has made many mistakes"

Scott Bessent, U.S. Treasury Secretary, emphasized the Fed's political independence on Sept. 1 local time while also saying that "the Fed has made many mistakes." Bessent made the remark in an interview with Reuters. In effect, he appeared to defend President Trump's outspoken criticism of Fed Chair Jerome Powell for not yielding to calls for rate cuts. In an interview with another outlet, he also said he could declare a "national housing emergency" this fall to stabilize housing prices that surged after the COVID-19 pandemic. This could lead to measures such as expanding supply and possibly considering tariff exemptions on certain construction materials.

◆ Xi, Putin and Kim to appear together at Beijing parade

For the first time since the end of the Cold War, the leaders of North Korea, China and Russia will appear together. At the Victory Day 80th anniversary parade in Beijing tomorrow (the 3rd), Xi Jinping, Vladimir Putin and Kim Jong-un sitting side by side will itself showcase the momentum of an anti-Trump and anti-Western alliance. If the three hold their first-ever trilateral meeting, it could be compared to the 2023 Camp David summit of South Korea, the U.S. and Japan, further highlighting a South Korea‑U.S.‑Japan vs. North Korea‑China‑Russia division. From Korea, Woo Won-shik, second in protocol order, will attend the parade.

◆ Today's party-government meeting on the 2nd round of livelihood recovery consumption coupons

The Democratic Party and the government will hold a party-government consultative meeting today (the 2nd) to discuss the second round of livelihood recovery consumption coupons. The closed-door meeting will include Interior and Safety Minister Yoon Ho-jung and members of the National Assembly's Public Administration and Security Committee from the Democratic Party. As the first Public Administration and Security Committee party-government meeting since the inauguration of the Lee Jae-myung administration, the agenda will include the second consumption coupon program, which will accept applications starting on the 22nd of this month. The second consumption coupon will provide 100,000 won per person to 90% of the population, excluding the top 10%, and the government plans to finalize the payment criteria by the 10th.

◆ Rain mainly in southern regions…highs up to 33°C

Today, Tuesday, the country will be mostly cloudy with rain in some areas. Rain will fall until the morning in central and southern Gangwon and the Chungcheong region, until the afternoon on the northern Gangwon east coast and Jeju Island, and until the evening in the southern regions. Afternoon highs will be 28–33°C, and fine dust concentrations are forecast to be 'good' or 'moderate' nationwide.

Kim Bong-gu, Hankyung.com reporter kbk9@hankyung.com