What's Happening?
Gold prices have surged to US$4,365 per ounce, surpassing JP Morgan's predictions of US$4,000 per ounce by the second quarter of 2026. This increase is driven by investors seeking safety amid rising US-China trade tensions and the ongoing US government
shutdown. Over the past month, gold's price has increased by 19.10% and is up 61.83% compared to the same time last year. The surge is supported by central bank buying, expectations of rate cuts, and heightened geopolitical risks.
Why It's Important?
The significant rise in gold prices reflects the global economic and geopolitical uncertainties influencing investor behavior. As a traditional safe-haven asset, gold's increased demand highlights concerns over trade tensions and government instability. The price surge also indicates a structural shift in gold's demand, influenced by geopolitical factors. This trend could impact global commodities markets and investor strategies, as gold becomes a focal point for risk-averse investors.
What's Next?
ANZ forecasts that gold will reach US$4,400 per ounce by the end of 2025, driven by geopolitical, economic, and financial uncertainties. The price is expected to peak near US$4,600 per ounce by June 2026, followed by easing in the second half of the year. Investors and market analysts will continue to monitor geopolitical developments and monetary policy decisions that could affect gold prices.
Beyond the Headlines
The surge in gold prices underscores the asset's role as a hedge against geopolitical and economic instability. The ongoing US-China trade tensions and government shutdown highlight the interconnectedness of global markets and the influence of political events on commodity prices.
