World gold prices have surpassed the $4,000/ounce mark for the first time.
Global gold prices have surpassed the $4,000/ounce mark for the first time, marking a historic milestone amidst economic instability and geopolitical tensions.
Gold surged on safe-haven demand and expectations of lower interest rates.
Yesterday, October 8th, the price of gold reached a new peak of $4,000 per ounce, surging thanks to the influx of money into safe-haven assets amid global volatility. According to analysts, investors are turning to gold as a lifeline amidst economic uncertainty and expectations that the Fed will continue to lower interest rates in the near future.
Since the beginning of the year, gold prices have risen by 51%, primarily due to increased buying by central banks, renewed capital inflows into gold ETFs, a weakening US dollar, and increased safe-haven sentiment among individual investors. Notably, in the first quarter of 2025, gold recorded its strongest quarterly increase since 1986.
Gold is considered a safe investment in an environment of low interest rates and high inflation, as its value is less likely to erode over time.
The US government shutdown has left markets lacking crucial economic data such as jobs reports, forcing investors to rely on alternative sources to predict when the Fed will decide to cut interest rates.
The market is currently betting the Fed will cut rates by 0.25 percentage points at its October meeting and continue with a similar cut in December. Michael Langford, Chief Investment Officer of Scorpion Minerals, forecasts gold could reach $4,300 per ounce in the next six months as the US dollar continues to weaken.
The sentiment to move away from the US dollar is spreading.
Billionaire investor Ken Griffin expressed concern as gold is gradually becoming a safer asset than the US dollar, arguing that the trend of de-dollarization is clearly underway. He noted that many investors are seeking to reduce risk from US public debt, shifting their portfolios to gold and other defensive assets.
Goldman Sachs also raised its gold price forecast for the end of 2026 to $4,900 per ounce, an increase of $600 from its previous forecast. At the same time, the People's Bank of China purchased more gold for the 11th consecutive month in September, indicating that major economies continue to bolster their reserves of the precious metal.
Experts believe that if central banks continue their buying trend and safe-haven demand persists, gold prices could easily set new records in the coming months.
