On October 8, the world gold price exceeded the threshold of 4,000 USD/ounce for the first time, as investors rushed to safe-haven assets amid global economic and geopolitical instability, while betting on the possibility of the US Federal Reserve (Fed) cutting interest rates.
According to records, spot gold prices increased by 1.4%, to 4,039.10 USD/ounce, while December gold futures increased similarly, reaching 4,061.80 USD. Silver also benefited from gold's rally, taking a 2% increase to $48.76/ounce, approaching a record high of $49.51.
Since the beginning of 2025, gold prices have increased by about 54%, after increasing by 27% in 2024, becoming one of the world's most profitable assets, surpassing stocks, Bitcoin and the USD.
Analysts said that this breakout is the result of a series of contributing factors, including expectations of a Fed rate cut, safe-haven demand during the period of political and economic instability, strong buying from central banks, inflows into gold ETFs and a weakening USD.
StoneX expert Rhona OConnell said the geopolitical landscape remains volatile, while the prolonged US government shutdown has also prompted investors to seek to reduce risks by buying gold.
The US government's suspension has delayed economic reports, forcing the market to rely on non-governmental data sources to predict when the Fed will take action. Investors now see the Fed cutting rates by 25 basis points in the upcoming session, and continuing to do so in December.
Tensions in the Middle East, conflict in Ukraine, and political crises in France and Japan are fueling a strong wave of gold purchases. Mr. Michael Hsueh, an expert from Deutsche Bank, said that the return of gold ETFs in developed markets to accumulate for the first time in 5 years has contributed to strengthening this increase.
Many financial institutions such as Goldman Sachs and UBS have raised their gold price forecasts for next year, as they expect low interest rates, central bank purchasing power and cash flow from individual investors to continue to support the market. Mr. Nitesh Shah, commodity strategist at WisdomTree, predicted that gold prices could reach 4,530 USD/ounce by the end of the third quarter of 2026.
Experts say the FOMO (fear of missing out) mentality is pushing the increase even stronger, while US President Donald Trump's desire to maintain low interest rates makes gold continue to attract global investors.
