Gold is at a 13-month high and eyeing a new record as investors see limited Fed tightening ahead

• Gold climbed to a 13-month high Wednesday and is nearing its record $2,075.47, which it hit in August 2020.
• March's bank turmoil initially pushed investors into the safe-haven, and the metal's latest gains follow easing expectations for more Fed rate hikes.

Gold prices moved toward a 13-month high Wednesday on the heels of data showing a labor-market slowdown.

The commodity traded at $2,030.47 Wednesday, and it's up more than 10% over the last four weeks. In August 2020, gold hit a record of $2,075.47.

The new data released over the past two days has shown a cooling labor market, which investors are taking as a signal the Federal Reserve's rate hikes are working, something that could lead to a less aggressive pace of future rate hikes. Since gold has historically weakened during periods of tightening, the expected easing has been a boon for the commodity.

The recent banking turmoil that began with Silicon Valley Bank has also contributed, as nervous investors have fled to safe havens like gold. Further, the resulting tight credit conditions have also done the Fed's job for it, as shown by the central bank only raising rates by 25 basis points at its recent meeting. This all points to a more accommodative stance going forward, which would be positive for gold.

Joe Cavatoni, market strategist for The World Gold Council, wrote in emailed comments that the possible onset of a recession suggests more upside ahead for gold.

"If you look at gold's performance historically, it's the kind of asset that should perform well as it has done in the last 5 out of 7 recessions," he noted.

Bank of America shared that same outlook for the commodity in a Wednesday note.

"We see gold breaking out of a bullish pennant pattern that favors a continuation of the uptrend that began in 4Q22," BofA's Paul Ciana wrote, adding that silver prices are signaling a similar trend higher.

"A new all-time closing high in gold prices above 2078 on daily and weekly charts would go a long way in signaling significantly larger upside in 2023-2025 such as 2391/2543," he said. "It would also reduce the risk of remaining stuck in its three-year trading range and succumbing to the risk of a somewhat consensus uptrend."