Global Gold Price Soars Past $4,000 Amid Market Turmoil

Global Gold Price Soars Past $4,000 Amid Market Turmoil

The global price of gold has surged past $4,000 (£2,985) an ounce for the first time in history, as investors seek safe-haven assets amid rising economic and political uncertainty.

Gold’s meteoric rise — over 25% since April — marks its sharpest rally since the 1970s. The surge follows renewed global trade tensions after U.S. President Donald Trump imposed tariffs earlier this year, unsettling financial markets and prompting investors to move towards safer holdings.

Analysts say the ongoing U.S. government shutdown, now entering its second week, has further fuelled anxiety. The delay in key economic data releases and uncertainty over fiscal policy have driven investors away from volatile markets and towards gold.

Spot gold — the price for immediate purchase — climbed above $4,011 an ounce on Wednesday morning in Asia. Gold futures, which reflect market sentiment, also crossed the same level earlier this week.

Christopher Wong, a rates strategist at OCBC Bank, described the shutdown as “a tailwind for gold prices,” noting that similar shutdowns in the past have triggered spikes in demand for the precious metal.

During Trump’s previous month-long shutdown, gold prices climbed nearly 4%. However, Wong cautioned that the rally could cool if the shutdown ends sooner than expected.

Heng Koon How, head of markets strategy at UOB Bank, called the surge an “unprecedented rally,” driven not only by institutional investors but also by a growing number of retail buyers. He said a weakening U.S. dollar and global monetary easing have amplified demand.

Gregor Gregersen, founder of Singapore-based Silver Bullion, reported that his customer base has more than doubled in the past year. “Most of our clients are long-term holders who see gold as protection against economic shocks,” he said.

Experts warn, however, that gold’s ascent may not be indefinite. Rising interest rates or easing geopolitical tensions could trigger corrections. In April, for instance, prices dipped by about 6% after Trump backed off from firing Federal Reserve Chair Jerome Powell.

“Gold is often viewed as a hedge against uncertainty — but that hedge can unwind quickly,” said Wong.

In 2022, gold prices tumbled from $2,000 to $1,600 an ounce when the U.S. central bank raised interest rates to combat pandemic-driven inflation. A sudden resurgence in inflation could similarly prompt the Federal Reserve to tighten monetary policy again, dampening gold’s appeal.

Still, investors are betting that the Federal Reserve will cut rates soon, a move that typically makes gold more attractive.

Trump has intensified pressure on the Fed, publicly criticising Chair Powell for not lowering rates quickly enough and reportedly attempting to dismiss Fed Governor Lisa Cook.

Such actions, analysts say, risk undermining confidence in the Fed’s independence and its ability to manage inflation effectively — further reinforcing gold’s position as a hedge against political and financial instability.

“In this environment, gold’s role as a store of value and shield against uncertainty gains renewed importance,” Wong added.