Global Gold Prices Break Records and Continue to Climb
The global financial market is witnessing a significant and sustained surge in gold prices, which for the first time in history have surpassed the $4,000 mark per troy ounce.
This phenomenon results from massive central bank and private investor purchases, viewing gold as a safe haven amid economic and political turbulence worldwide.
According to the renowned financial newspaper The Financial Times, gold prices have increased by more than 50% since the beginning of the year, reaching a level of $4,001 on Tuesday, effectively doubling in less than two years.
Experts attribute this boom to central banks actively diversifying their reserves away from the US dollar and increased demand from private investors seeking stability during global economic uncertainties.
Billionaire hedge fund founder Ray Dalio emphasizes that gold now represents a more secure asset than the dollar and is an excellent diversification tool for investment portfolios.
Given the scale of global debt, which has hit record levels, investors are looking for more tangible assets to preserve their wealth, and gold remains the most fundamental.
Historically, sharp increases in gold prices have coincided with global crises: in 2008 during the financial meltdown, prices exceeded $1,000; in 2020, they reached $2,000 amid Covid-19 pandemic, and this spring they approached $3,000.
Recent weeks have seen a further 20% increase mainly due to capital inflows into gold-backed ETFs.
Industry experts point to partial US government shutdown and growing macroeconomic concerns as catalysts.
Ross Norman, founder of Fastmarkets and Metals Daily, warns about the parabolic nature of this rise, cautioning against unmoderated growth that may lead to a bubble.
Central banks’ record purchases over the past three years—around 1,000 tons annually—have also played a crucial role in this trend, driven by efforts to reduce dependence on the dollar.
Michael Heg, a senior analyst at Societe Generale, states that the $4,000 level is not a ceiling, as the upward trend remains strong.
Meanwhile, Helen Amos of BMO notes that the rise reflects investor worries over US debt levels and the Fed’s independence.
As a result, Goldman Sachs has upped its gold price target from $4,300 to $4,900 per ounce, predicting further growth in demand from central banks and investment funds.