Gold price is on a historic run as the gold rate on Wednesday hit the $4,000-mark first time. Spot gold was up 0.7 per cent at $4,011.18 per ounce. U.S. gold futures for December delivery gained 0.7 per cent to $4,033.40 per ounce. Traders have been piling into gold all year, pushing it up more than 50 percent since the turn of the year, on the back of a range of issues including global economic uncertainty, Donald Trump’s trade war and geopolitical crises.
Gold Rate in October
In October investors piled into the safe haven over expectations for US interest rate cuts and worries over the US government shutdown. Gold price rally also came after concerns that a tech-fuelled rally that has sent some equity markets to record highs may have gone too far, fanning talk of an asset bubble.
Its allure was increased further this week by political turmoil in France, where the country’s prime minister resigned and President Emmanuel Macron’s former premier urged him to resign and call early elections. Also the scenario in Japan looks not so positive.
Gold — long considered a go-to in times of uncertainty — climbed to a high of $4,006.68 on Wednesday, even as the dollar has pushed up against most of its peers in recent days. Silver was also within a few dollars of its own record high.
“The rapid rise in gold prices has been supported by rising inflows into (exchange-traded funds) and central bank buying, including solid demand from China, as gold benefits from political, economic, and inflation uncertainty,” wrote Taylor Nugent at National Australia Bank.
Gold Price to Fall Soon?
Traditionally, gold is seen as a store of value during times of instability. Spot gold is up 53 per cent year-to-date after rising 27 per cent in 2024.
“There’s so much faith in this trade right now that the market will look for the next big round number which is 5,000 with the Fed likely to continue to lower rates,” said Tai Wong, an independent metals trader.
“There will be some bumps in the road like a lasting truce in the Mideast or Ukraine but the fundamental drivers of the trade, massive and growing debt, reserve diversification, and a weaker dollar are unlikely to change in the medium term,” the expert said.
“Rising uncertainty levels tend to fuel gains in the gold price and we are seeing this theme play out again,” said KCM Trade Chief Market Analyst Tim Waterer.
“Market dynamics of lower U.S. interest rates and the ongoing government shutdown are still working in favour of gold. But the temptation to take profits around the $4,000 mark pose a potential short-term risk,” Tim Waterer said.
A “fear of missing out” is also boosting the rally, analysts say. Analysts expect strong inflows into exchange-traded funds backed by physical gold, central bank buying and the prospect of lower U.S. interest rates to support gold prices in 2026, prompting Goldman Sachs and UBS to raise their price outlooks.
FAQs
Q1. What are current price of Silver?
A1. Spot silver rose 1.3 per cent to $48.42 per ounce, platinum gained 2.5 per cent to $1,658.40 and palladium climbed 1.8 per cent to $1,361.89.
Q2. What are current gold prices?
A2. Spot gold was up 0.7 per cent at $4,011.18 per ounce. U.S. gold futures for December delivery gained 0.7 per cent to $4,033.40 per ounce.
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