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Silver reaches 14-year-high on US rate cut bets. Gold reaches four-month high.

Gold reached a four-month high Monday, as the U.S. Federal Reserve cut interest rates this month. A softer dollar also boosted gold's appeal. Silver broke $40 per ounce again for the first since 2011.

Gold spot gained 0.9%, reaching its highest level since April 22, at $3,477.89 an ounce, by 847 GMT. U.S. Gold Futures for December Delivery gained 0.9%, reaching $3,548.0.

Spot silver rose 2.7% to $40.72 per ounce, the highest level since September 2011.

Dollar-priced gold is cheaper for foreign buyers, as the U.S. currency has been trading at its lowest level since July 28, making it more affordable.

Ole Hansen is the head of Saxo Bank’s commodity strategy. He said that "gold, and particularly silver, continued Friday’s strong gains. This was supported by U.S. inflation sticking, weakening consumers sentiment, (expected), rate cuts... and concerns about Fed independence."

Data released on Friday showed that the U.S. Personal Consumption Expenditures Price Index rose in line with expectations by 0.2% from month to month and 2.6% over a year.

Tim Waterer, KCM Trade’s chief market analyst said that silver is moving higher due to the expectation of lower interest rates. A tight supply market also helps to maintain a positive bias.

Mary Daly, President of the San Francisco Federal Reserve Bank, reiterated last week her support for a cut in interest rates, citing risks on the labour market.

The market is waiting for the U.S. jobs report on Friday, expecting that it will allow the Fed rate cuts to resume from September (given) that it supports investment demand", said UBS analyst Giovanni Staunovo.

A poll indicated that the August non-farm payrolls due on Friday are expected to show an increase of 78,000 jobs compared to 73,000 in July.

Gold that does not yield is usually a good investment in an environment with low interest rates.

U.S. trade representative Jamieson Greer stated on Sunday that the administration of President Donald Trump was continuing to talk with trading partners despite an U.S. Court ruling that most tariffs were illegal.

Palladium rose 0.4% and platinum grew 2.2%, respectively, to $1113.06. (Reporting by Ishaan Arora and Brijesh Patel in Bengaluru; Editing by Sumana Nandy)

(source: Reuters)