Gold entered the second quarter of the year with a record

Gold rose to a record high at the start of the second quarter and continued to rise as the Fed nears interest rate cuts and geopolitical tensions deepened. Bullion rose to $2,259.69 an ounce early Monday, up 1.3 percent from Thursday’s close, after reaching a series of peaks in recent sessions. The Fed’s core personal consumption expenditures index, which is its preferred indicator of inflation, cooled in February when most markets were closed on Friday. Although the U.S. central bank is taking a cautious stance, that underpins the case for lower borrowing costs. A number of positive factors have pushed bullion up about 14 percent since mid-February. The possibility of quantitative easing by major central banks and rising tensions in the Middle East and Ukraine have supported the rally. Central banks in China in particular are making strong purchases, while consumers there are loading up on bullion amid ongoing problems in Asia’s largest economy. Following the inflation figures, Fed Chairman Jerome Powell said pressures were “roughly in line with our expectations” and that there was no rush to cut rates. Later this week, investors will get another chance to gauge the outlook for the U.S. economy and central bank policy, with monthly payrolls expected to rise by at least 200,000 for a fourth straight month. Swap markets are pricing in a 61% chance of a Fed rate cut, up from 57% on Thursday. Lower rates are generally positive for gold, which pays no interest. “The inflation data, and Powell’s comments in particular, have provided further support for gold, with the market increasingly convinced that the Fed will begin cutting rates in June,” said Warren Patterson, head of commodity strategy at ING Group.