Gold rose over $4,000 per ounce on Tuesday, hitting a new record high as investors moved into the precious metal amid a weaker dollar and growing expectations of more rate cuts from the US Federal Reserve.
Futures for gold are now up more than 50% this year, marking the strongest annual performance since 1979.
A World Gold Council report released on Tuesday showed that Gold-backed global exchange-traded funds (ETFs) saw their largest quarterly inflows on record for the three months ending in September.
Inflows into gold ETFs rose 23% to $26 billion compared to the previous quarter, led by North American investors, followed by those in Europe and Asia.
“Ongoing trade, politics and geopolitical risks continue to persist with no clear signs of abatement,” the report said.
The report also noted a significant increase in gold trading activity during the period. Average daily volumes were up 34% month over month, fueled by record prices that hit 13 new all-time highs in September.
Wall Street analysts remain bullish on gold. Goldman Sachs recently reaffirmed the metal as its “most condemned recommendation.”
On Monday, JPMorgan analysts said that “pullbacks, which typically occur 2-3 months after the initial power outage, have been declines to buy in gold.”
Concerns about the independence of the Federal Reserve, following President Trump’s push to remove Fed Governor Lisa Cook, have also added to gold’s bullish outlook.
“From a gold perspective, if the stoked independence fears are realized, it could dampen confidence in Treasuries and rapidly increase debt downgrade anxiety, with increased inflows into the metal having the potential to supercharge a rally and add even greater upside risk to our initial forecasts,” JPMorgan Analysts wrote last month.
While JPMorgan forecasts gold reaching $4,000 in early 2026, the bank also said that “even relatively thin rotations” away from the US Treasury market in gold could push prices beyond $5,000 per ounce within two quarters.
(Yahoo Finance)
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