Gold prices climbed higher on Tuesday and posted the largest single-session gain in over eight months, after the U.S. Federal Reserve surprisingly cut interest rates two weeks ahead of the scheduled monetary policy meeting.

The Federal Reserve announced its decision to lower the target range for the federal funds rate by 50 basis points to 1 to 1.25%. The accompanying statement from the Fed say the fundamentals of the U.S. economy remain strong but added that the coronavirus poses evolving risks to economic activity.

The central bank added that it is closely monitoring developments and their implications for the economic outlook and will use its tools and act as appropriate to support the economy.

The dollar index dropped to 96.98 and was last seen at 97.06, down by about 0.3% from previous close.

Gold futures for April ended up $49.60, or 3.1%, at $1,644.40 an ounce.

Silver futures for May ended up $0.449 at $17.188 an ounce, while Copper futures for May settled at $2.5730 per pound, down $0.0220 from previous close.

Earlier in the day, Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell led a conference call with the G7 Finance Ministers and Central Bank Governors on Tuesday to discuss the coronavirus.

In a statement released following the call, the G7 finance chiefs reaffirmed their commitment to use “all appropriate policy tools to achieve strong, sustainable growth and safeguard against downside risks.”

The Reserve Bank of Australia has cut official interest rates to a new record low of 0.5% to support the economy. The Bank of Japan and the European Central Bank have indicated that they would take appropriate and targeted measures to fight the economic impact of the novel virus.

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