Gold prices notched another all-time high on Monday, crossing the $4,100-an-ounce mark for the first time, as renewed US-China trade tensions sent investors flocking to safe-haven assets.
Spot gold rose as much as 2% to $4,103.05 per ounce, a sizeable rebound from last Friday’s pullback. Meanwhile, US gold futures jumped by nearly 2.9% to a high of $4,124.30 per ounce in New York.
Monday’s move takes bullion’s year-to-date gains to above 54%, as geopolitical and economic uncertainties around the world continued to fuel demand for safe-haven assets. Fresh tensions between the US and China reignited fears of a trade war between the world’s two largest economies, serving as a catalyst for the latest rally.
The rise in gold prices happens when investors are concerned about the state of the world, either economically or politically, said Jeffrey Christian, managing partner of CPM Group, in a note to Reuters.
Christian added that expectations of US interest rate cuts are also supporting prices. Since August, the month leading up to the Federal Reserve’s first rate cut, gold prices have gained about 24%, accounting for nearly half of the year’s gains.
Investors are currently pricing in a 97% probability of another 25-basis-point Fed rate cut at the end of this month and a 100% chance for a third cut in December.
Against the backdrop of rate cut expectations as well as strong central bank buying of gold, most major banks have lifted their forecast for the metal for 2025 and beyond. Recently, Bank of America and Société Générale both said they expect gold to reach $5,000 an ounce in 2026.
“Given the carousel of drivers, and how short-lived dips have been, this rally has legs in our view, but a near-term correction would be healthier for a longer-term uptrend,” said Suki Cooper, global head, commodities research at Standard Chartered Bank.
(With files from Reuters)
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Gold prices notched another all-time high on Monday, crossing the $4,100-an-ounce mark for the first time, as renewed US-China trade tensions sent investors flocking to safe-haven assets.
Spot gold rose as much as 2% to $4,103.05 per ounce, a sizeable rebound from last Friday’s pullback. Meanwhile, US gold futures jumped by nearly 2.9% to a high of $4,124.30 per ounce in New York.
Monday’s move takes bullion’s year-to-date gains to above 54%, as geopolitical and economic uncertainties around the world continued to fuel demand for safe-haven assets. Fresh tensions between the US and China reignited fears of a trade war between the world’s two largest economies, serving as a catalyst for the latest rally.
The rise in gold prices happens when investors are concerned about the state of the world, either economically or politically, said Jeffrey Christian, managing partner of CPM Group, in a note to Reuters.
Christian added that expectations of US interest rate cuts are also supporting prices. Since August, the month leading up to the Federal Reserve’s first rate cut, gold prices have gained about 24%, accounting for nearly half of the year’s gains.
Investors are currently pricing in a 97% probability of another 25-basis-point Fed rate cut at the end of this month and a 100% chance for a third cut in December.
Against the backdrop of rate cut expectations as well as strong central bank buying of gold, most major banks have lifted their forecast for the metal for 2025 and beyond. Recently, Bank of America and Société Générale both said they expect gold to reach $5,000 an ounce in 2026.
“Given the carousel of drivers, and how short-lived dips have been, this rally has legs in our view, but a near-term correction would be healthier for a longer-term uptrend,” said Suki Cooper, global head, commodities research at Standard Chartered Bank.
(With files from Reuters)
Sponsored: Secure your wealth today — buy gold bullion directly through our trusted partner, Sprott Money.