Gold prices hit an all-time high on Wednesday, surpassing $4,200 per ounce as investors piled into the safe-haven metal amid rising hopes for U.S. interest rate cuts and renewed geopolitical tensions.
Spot gold climbed 1.2% to $4,188.95 per ounce as of 1:53 p.m. WAT (13:53 WAT), after touching $4,217.95 earlier, while U.S. gold futures for December delivery rose 1% to $4,205.20.
Analysts point to multiple drivers behind the rally. “The metal has been on a tear, and it doesn’t look like it wants to stop,” said Fawad Razaqzada, market analyst at City Index and FOREX.com. “With U.S.-China trade tensions being reignited in the last few days, investors have even more reason to hedge their long equity bets by diversifying into gold.”
Gold has jumped nearly 58% this year, fueled by geopolitical jitters, expectations of central bank rate cuts, growing central bank purchases, de-dollarisation trends, and robust ETF inflows.
Traders are pricing in a 25-basis-point cut in October with 98% probability, followed by a fully priced December rate cut.
The U.S. dollar weakened against a basket of peers after Federal Reserve Chair Jerome Powell struck a dovish tone on Tuesday, noting the labour market remains in “low-hiring, low-firing doldrums.”
Safe-haven demand for gold is further supported by U.S.-China trade tensions, including tit-for-tat port fees, and concerns over a U.S. government shutdown, which has halted official economic data.
Other precious metals tracked gold’s gains. Silver rose 2.5% to $52.75, after hitting a record $53.6, driven by tight London supply and extreme backwardation, though the rally may reverse if shortages ease.
Platinum gained 0.9% to $1,651.85, and palladium climbed 1.8% to $1,553.43.
A short-term correction could shake out weaker hands, the $5,000 per ounce milestone remains within reach, suggesting strong investor confidence in gold’s continued ascent.