Gold prices have once again made history. For the first time ever, the precious metal has surpassed the US$4,000 per ounce mark, briefly touching a daily high of US$4,037 — marking a new milestone in the ongoing uptrend fueled by mounting global economic concerns and political turmoil in the United States.
This sharp rally reflects a major shift in market sentiment: investors are rapidly abandoning risk assets and seeking safety in what is considered the most secure instrument — gold.
Political Uncertainty and the U.S. Government Shutdown Threat
One of the key drivers behind gold’s surge is the political deadlock in Washington. The U.S. government faces the threat of a shutdown due to budget disagreements in Congress, sparking fears that the economy could be disrupted if the shutdown persists.
For many investors, such uncertainty is a clear signal to protect their wealth. “Whenever markets see fiscal instability in the U.S., gold is always the first port of call,” said a market analyst quoted by the BBC.
Weaker Dollar Boosts Gold’s Appeal
Beyond politics, the decline of the U.S. dollar has added fuel to gold’s rally. A weaker dollar makes gold cheaper for overseas buyers, stimulating global demand. Analysts note that the combination of currency weakness, falling bond yields, and heightened geopolitical anxiety has created a “perfect storm” for gold’s rise.
Retail Participation and Psychological Momentum
Interestingly, this rally isn’t just being driven by institutional investors. Many retail investors have joined in, purchasing physical gold and gold-backed ETFs. The surge in demand has created a psychological momentum that further strengthens the bullish trend.
“When prices start breaking new records, the psychological effect is powerful. Investors don’t want to miss out,” another analyst told the BBC.
Will Gold Continue to Rise?
While the outlook remains positive, some economists caution that the rally could lose steam if uncertainty fades or U.S. economic data improves. Historically, gold prices tend to correct when interest rates rise or inflation becomes more stable.
However, for now, with geopolitical tensions simmering and the global economy still fragile, gold continues to stand as a symbol of safety and investor confidence.
The surge past US$4,000 per ounce is not merely a reflection of market trends but also a mirror of fear, caution, and the universal pursuit of stability in a volatile world. For many, gold has once again proven its true nature — not just as a precious metal, but as the ultimate store of value and trust.
Goldman Sachs Raises 2026 Gold Price Forecast to US$4,900
In its latest report, Goldman Sachs raised its end-2026 gold price forecast to US$4,900 per ounce, up from the previous estimate of US$4,300. The revision is driven by sustained demand from both central banks and Western investors.
According to Goldman, the 17% surge in gold prices since late August has been largely fueled by inflows into Western ETFs and significant purchases by central banks, especially from emerging markets.
“This demand is sticky — it doesn’t easily reverse — which raises the baseline of our pricing model,” wrote the team led by Lina Thomas.
The bank projects that central bank gold purchases will average 80 tons in 2025 and 70 tons in 2026, reflecting developing nations’ long-term strategy to diversify reserves away from the U.S. dollar. This factor alone is expected to contribute around 19 percentage points to gold’s anticipated price increase through 2026.
Furthermore, Goldman expects Western ETF demand to rise alongside a Federal Reserve rate cut of 100 basis points by mid-2026, potentially adding another 5 percentage points to the rally.
Ade Yunus
Global Market Strategies