PRECIOUS-Gold scales near three-week peak on Fed rate cut bets

Nov 11 (Reuters) - Gold extended gains to a near three-week high on Tuesday, as growing expectations of another U.S. Federal Reserve interest rate cut in December lifted demand for the safe-haven asset.

FUNDAMENTALS

Spot gold XAU= was up 0.4% at $4,131.83 per ounce by 0053 GMT, its highest since October 24. U.S. gold futures GCcv1 for December delivery rose 0.4% to $4,138.70 per ounce.

Last week, data showed the U.S. economy shed jobs in October amid losses in the government and retail sectors.

U.S. consumer sentiment weakened to a 3-1/2-year low in early November amid worries about the economic fallout from the longest ever U.S. government shutdown, a survey showed on Friday.

Traders are pricing in a roughly 64% probability that the U.S. central bank will cut rates by 25 basis points next month, according to CME Group's FedWatch tool.

Fed Governor Stephen Miran said on Monday a 50-bps rate cut would be appropriate for December, noting that inflation is falling while the unemployment rate is drifting higher.

Non-yielding gold tends to do well in a low-interest-rate environment and during economic uncertainties.

The U.S. Senate on Sunday moved forward on a measure aimed at reopening the federal government and ending a now 40-day shutdown that has sidelined federal workers, delayed food aid and snarled air travel.

If the Senate passes the bill, which would fund the government until January 30 and include a package of three full-year appropriations bills, it must then be approved by the House of Representatives and sent to President Donald Trump, a process that could take several days.

China's gold consumption in the first three quarters of 2025 declined at a slower pace than the preceding year, as strong safe-haven interest continued to support investment demand despite high prices weighing on jewellery buying.

Elsewhere, spot silver XAG= firmed 0.2% to $50.66 per ounce, platinum XPT= rose 0.3% to $1,582.60 and palladium XPD= added 0.8% to $1,425.71.