Gold prices escalated to a record high above $2,100 on Monday as traders grow increasingly confident about the interest rate cut by Federal Reserve in the New Year.

The precious metal struck $2,135.39 in early Asian trade, topping the previous all-time high set in 2020, during the pandemic.

It has been given extra strength as a string of data points to a slowdown in inflation that has led to speculation the Fed can slash rates, reports AFP.

Bets on a drop in rates have weighed on the dollar, which has in turn made gold cheaper for international buyers.

Traders began shifting into the metal after Fed boss Jerome Powell said Friday that rates are "well into restrictive territory", fanning hopes the bank could begin cutting soon.

Bloomberg reported that traders saw a 60 percent chance of such a move in March, while they have fully priced one in May.

Bd-pratidin English/Lutful Hoque