Investing.com — Gold prices rose Tuesday, climbing to new record highs, helped by dollar weakness as traders grew more convinced that the Federal Reserve will begin cutting interest rates in September. 

At 08:15 ET (12:15 GMT),  rose 0.9% to $2,526.43 an ounce, while climbed 0.9% to $2,564.95 an ounce.

Gold hits record highs on rate cut bets 

Spot prices have hit new highs amid growing conviction that the Fed will begin cutting rates from September.

Traders are pricing in a 76% chance the Fed will cut rates by 25 basis points at the next Fed meeting, and a 24% chance for a 50 bps cut, showed.

Lower rates bode well for gold, given that they reduce the opportunity cost of investing in non-yielding assets.

An address from Fed Chair Powell, on Friday, is expected to offer more cues on the bank’s plans to cut rates.

“Gold prices are up 22% so far this year amid geopolitical uncertainties, expectations of interest rate cuts from the Fed and strong buying appetite from central banks,” said analysts at ING, in a note.

“Looking ahead, we expect gold to stay near record highs on expectations that the U.S. Fed is getting closer to an interest rate cut. We believe that gold’s focus will remain firmly on the scope and timing of the Fed’s likely move to cut rates, with Jackson Hole later this week potentially providing some further clarity on the path the Fed may take.”

Other precious metals also climbed higher, with rose 0.6% to $968.65 an ounce, while rose 1.8% to $29.823 an ounce. 

Copper dips as Escondida strike averted 

Among industrial metals, copper prices edged higher Tuesday, with the benchmark on the London Metal Exchange climbed 0.2% to $9,268.50 a ton, while one-month rose 0.4% to $4.1980 a pound.

BHP reached an agreement with labor unions at the Escondida mine on Sunday, averting a potential strike that stood to severely limit global copper supplies. 

Escondida accounts for 5% of global copper supplies, with a 40-day strike at the mine in 2017 having greatly boosted copper prices then.

Beyond supply disruptions, however, copper prices were nursing steep losses through August amid growing anxiety over weakening demand, especially in top importer China.

(Ambar Warrick contributed to this article.)

Markets are now awaiting more cues on interest rates from the Federal Reserve, with Chair Jerome Powell set to speak at the Jackson Hole Symposium on Friday.