02:02 PM EDT, 10/07/2025 (MT Newswires) -- Gold futures rose above $4,000 for the first time, buoyed by investor hedging against economic and political risks amid expectations of more interest rate cuts from the Federal Reserve.

Gold for December delivery rose 0.8% to $4,008.2 per troy ounce in Tuesday trade, having reached $4,014.60 earlier in the session. Spot gold gained 0.6% at $3,982.35 an ounce.

In addition to the US government shutdown that has delayed key economic data releases, political shakeups in France and Japan are fueling fiscal concerns, ING said in a report on Tuesday.

French Prime Minister Sebastien Lecornu resigned on Monday, weeks after his appointment. In Japan, the ruling party picked Sanae Takaichi as its new head on Saturday, putting her on course to become the country's first female prime minister.

The yellow metal is up more than 50% year-to-date, "driven by US President Donald Trump's aggressive trade and geopolitical moves, which sparked a flight to safety and a shift away from the dollar," ING Head of Commodities Strategy Warren Patterson wrote. "Strong central bank buying, continued (exchange-traded fund) inflows and expectations of a further Fed rate cut have added fuel to the rally."

The data blackout during the US government shutdown leaves markets and the Fed in the dark about changing economic conditions.

"Despite the uncertainty, traders still expect a quarter-point rate cut this month," ING's Patterson said.

The Fed reduced its benchmark lending rate by 25 basis points last month, noting increased downside risks to employment and signaling further policy easing later in 2025.