New York after- transactions gold prices have risen nearly 71% this year, on track for their highest annual gain in 46 years. The last time gold had such a strong breakthrough was under US President Jimmy Carter, when the Middle East was in crisis, inflation soared and the US faced a serious energy crisis.
Currently, tariffs are affecting international trade, the Russia-Ukraine conflict, tensions between Israel and Iran, while the US is seizing oil tankers offshore in Venezuela.
In the context of increasing uncertainty, investors often seek safe-haven assets such as gold.
Gold is considered an investment channel with good resilience, maintaining value in times of crisis, when inflation increases sharply or when the currency depreciates.
"It is certainly still a prominent feature of the global economy. In this environment, gold is increasingly attractive as a tool for strategic diversification and stable sources, said Joe Cavatoni, senior market strategist at the World Gold Council.
Earlier this year, after-sales gold was trading around $2,640 an ounce. By the beginning of this week, the world gold price had surpassed the record of 4,500 USD/ounce. JPMorgan Chase analysts predict gold could surpass $5,000/ounce by 2026.
Gold's gains this year have far exceeded the S&P 500, which has gained about 18%. In 2024, gold after delivery increased by 27%, while the S&P 500 increased by 24%.
The Fed's forecast to continue cutting interest rates in 2026 is supporting gold's increase. A weak USD also contributes to pushing gold prices up, as gold becomes easier to buy for international investors.
The gold price increase is also supported by central banks stepping up gold purchases, in which China plays a leading role.
According to Ulf Lindahl, CEO of Currency Research Associates, one of the main reasons for the Chinese Central Bank increasing its gold reserves is to reduce its dependence on US assets such as bonds and the US dollar.
This trend became apparent after the Russia-Ukraine conflict broke out in 2022. Western countries have frozen Russian assets in USD, causing Russia, as well as China, to seek to reduce its dependence on US policy decisions.
Mr. Ole Hansen, Head of Commodity Strategy at Saxo Bank, commented that the current wave of gold purchases by central banks is very clear in geopolitics. The freezing of national reserves and the decline of the global financial system have created a structural element in gold demand, which is likely to last for many years.
According to the World Gold Council, central banks around the world have been buying more than 1,000 tonnes of gold per year for three consecutive years, double the previous decade's average of 400-500 tonnes per year.
The increase in gold has led to a breakthrough of many other precious metals such as silver, platinum and palladium. late- shift silver prices have risen to 146% this year, while platinum has risen nearly 150% and palladium has risen about 100%.
Mr. Hakan Kaya - portfolio manager at Neuberger Berman - gold will continue to increase in 2026. As central banks increase their gold reserves, the amount of gold in circulation in the market will decrease. Increased demand while limited supply could push prices higher.
