Gold prices surpassed the historical $3,900 per ounce mark on Monday, pointing to an increased flight toward safe-haven assets as investors negotiate a storm of economic and geopolitical turbulence. The recent rise of the metal shows increasing frailty in world markets, from political instability to changes in interest rates.
Spot gold climbed almost one per cent in morning trade to hover around $3,925.91 per ounce, near a record high of about $3,944.63. U.S. futures followed nearly. Extending a rally that has raised the yellow metal nearly 50% since the year’s start, reached $3,951.60 at 1.1%. Analysts contend the surge highlights gold’s resurgent function as a worldwide sanctuary in light of worries of currency instability, ECB’s interest rates
The environment for the ascent is intricate. Confidence in conventional safe assets has been shaken by a declining Japanese yen and the continuous U.S. government shutdown Federal Reserve board
Beyond speculative momentum, institutional demand has grown. Central banks keep gold at a pace not seen in years among their reserves. While retail purchasers throughout Asia and the Middle East have stepped up purchases amid inflationary pressures and currency devaluation, exchange-traded funds (ETFs)
Analysts, however, warn that if inflation slows or interest-rate forecasts change suddenly, the rate of gold’s increase could test investor tolerance. Market strategists contend that if global instability continues, the next psychological hurdle of $4,000 per ounce may be tested shortly. Still, volatility is a double-edged sword: what raises safe-haven demand today could reverse fast if macroeconomic confidence returns.
