The price of gold has surged past $4,000 an ounce for the first time, extending a powerful rally driven by political uncertainty in Japan, France, and the United States, where the federal government shutdown continues to weigh on markets.
Spot gold rose 1.15% to $4,029.46 per ounce, setting another record high, and is now up 50% so far this year, following gains of 27% in 2024 and 13% in 2023.
The precious metal’s advance underscores its status as a safe-haven asset in times of instability and a hedge against inflation, as investors seek protection from mounting global risks.
Gold prices have surged as investors increasingly expect the US Federal Reserve to continue cutting interest rates this month.
The Fed reduced borrowing costs for the first time this year in September, and money markets now indicate an 82% chance of two additional cuts at its final meetings of 2025. The United States, the world’s largest holder of gold, now possesses 8,133 tonnes of reserves valued at $1.04 trillion (£776bn) — marking the first time any nation’s holdings have exceeded the $1 trillion threshold.
Silver Nears Record High as Precious Metals Rally Continues
Silver is closing in on its all-time high amid surging demand for precious metals.
Spot silver rose to $48.79 per ounce, approaching the 2011 peak of $49.79, its highest level since 1980.
David Adams, analyst at Morgan Stanley, said the recent weakness in the US dollar has made commodities more affordable for foreign buyers. He added that precious metals are gaining appeal as “rising inflation can support demand for real assets.”
Mining Shares Lift FTSE 100 as Gold Rally Powers Past $4,000
Mining stocks led gains on the FTSE 100 on Wednesday, buoyed by gold’s historic surge above $4,000 an ounce for the first time.
Antofagasta, the Chilean copper and gold miner, overtook Lloyds Banking Group as the top performer on the index, with shares rising 2.7%.
Endeavour Mining, one of the world’s largest gold producers and the biggest in West Africa, also climbed nearly 2.7%, while Fresnillo, the Mexican precious metals miner and the world’s leading silver producer, gained 1.4%.
