Gold Prices Rise Above USD4,000 for First Time Ever

(MENAFN) Gold futures for December delivery on the New York Mercantile Exchange surged above the $4,000 per ounce mark on Monday evening local time, marking an unprecedented milestone in the metal’s history.

Since September, international gold prices have maintained robust upward momentum, with spot gold climbing over 50% year-to-date, positioning it among the world’s top-performing major assets. In contrast, silver experienced profit-taking following a recent 14-year peak.

Market analysts attribute the gold price surge to a convergence of factors. A weakening U.S. dollar and growing fiscal uncertainty have intensified gold’s appeal as a safe haven, while the ongoing partial U.S. government shutdown and delays in key economic data releases have left investors without clear economic direction.

Bloomberg highlighted that volatility in the U.S. Treasury market has dropped to its lowest point in nearly four years, encouraging investors to bolster gold holdings as protection against emerging risks.

The Federal Reserve’s recent interest rate reduction, combined with indications of further easing this year, has diminished the allure of dollar-based assets. “Lower real interest rates and expectations of improved liquidity have together fueled gold's rally,” sources said.

Adding to the bullish momentum, steady central bank purchases and inflows into gold-backed ETFs have been pivotal in pushing prices to record levels.

On Monday, Goldman Sachs increased its gold price forecast for December 2026 to $4,900 per ounce, up from $4,300, citing sustained demand from central banks and private sector diversification efforts.

The bank projects global central bank gold acquisitions to average 80 tons in 2025 and 70 tons in 2026, with emerging-market central banks expected to continue raising gold’s share in their reserves to reduce reliance on the U.S. dollar.

At the Greenwich Economic Forum in Connecticut on Tuesday, Bridgewater Associates founder Ray Dalio urged investors to allocate “something like 15 percent of your portfolio in gold.” He added, “Debt instruments are ‘not an effective storehold of wealth,’” while gold “is one asset that does very well when the typical parts of the portfolio go down.”

Despite the bullish sentiment, institutional perspectives remain mixed. On Sunday, Bank of America cautioned investors as gold neared $4,000, warning that the metal may face “uptrend exhaustion” and could undergo “a consolidation or correction” during the fourth quarter.

Industry experts noted that gold’s record rally underscores rising global demand for safe-haven assets amid declining confidence in U.S. dollar creditworthiness. Analysts predict that continued Federal Reserve rate cuts, further dollar depreciation, and ongoing geopolitical tensions could sustain gold’s strength.

Nevertheless, with prices at historic highs, the risk of short-term pullbacks is real. Several investment banks forecast gold will trade within the $3,800 to $4,100 per ounce range through year-end.

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