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Gold powers through USD 4,000 as investors question the old order
Matières premières
Ole Hansen
Head of Commodity Strategy
Key takeaways
- Gold’s relentless advance has entered uncharted territory after Asia saw the spot price break decisively above USD 4,000 per ounce for the first time
- The move above USD 4,000 is not simply a function of rate expectations or a weaker dollar. Rather, it reflects a deeper shift in investor psychology and global capital flows
- Year-to-date gains now stand near 52%, while silver and platinum have rallied 64% and 86%, respectively. Palladium, though less in focus, has added nearly 50%.
Gold’s relentless advance has entered uncharted territory after Asia saw the spot price break decisively above USD 4,000 per ounce for the first time, reaching USD 4,039 before stabilising - defying both a recovering dollar and renewed caution from the Federal Reserve on the pace of future rate cuts. The milestone caps a year-long rally that has rewritten the market’s understanding of what drives bullion prices—and perhaps, what investors now consider “safe.”
A rally born of distrust
The move above USD 4,000 is not simply a function of rate expectations or a weaker dollar. Rather, it reflects a deeper shift in investor psychology and global capital flows. In an increasingly fragmented world, the West’s weaponization of markets, payment systems, and reserve assets has eroded confidence in traditional safe havens such as the U.S. dollar and Treasuries. Sanctions, asset seizures, and concerns about fiscal sustainability have nudged investors—both institutional and sovereign—toward tangible assets that sit outside the financial system.
This erosion of trust has played out visibly since 2022, when Western sanctions froze Russia’s central-bank reserves and China began quietly increasing its gold holdings. Central banks have since added more than 1,000 tons of gold to their reserves annually, the strongest pace on record, while high-net-worth and institutional investors have followed with renewed allocations to physical gold and bullion-backed exchange-traded funds.
The result is a market no longer dominated by short-term speculative money reacting to real-rate moves, but by a persistent structural bid for security. The correlation that once defined gold’s inverse relationship with U.S. real yields has weakened markedly, underscoring the extent to which other forces—political, fiscal, and strategic—have taken control.
Breaking the old rules
For decades, gold traded as a mirror image of U.S. real rates. When inflation-adjusted yields rose, gold fell; when they fell, gold rallied. The logic was straightforward: the metal offers no yield, and therefore competes poorly with interest-bearing assets. That framework began to fray in 2022 as the Federal Reserve’s aggressive tightening failed to break gold’s resilience.
At the time, the Fed Funds rate rose by 525 basis points in just 17 months, yet gold refused to capitulate. Central-bank buying and Chinese demand offset the traditional rate-driven selling by Western asset managers. In late 2022, repeated attempts to push prices below USD 1,615 failed, setting the stage for a rebound that would culminate in the March 2024 breakout above USD 2,075—a level that had capped prices for three years. Once through that ceiling, momentum took over, reinforced by a wall of new inflows from both institutional and retail investors.
Since then, gold has not looked back. Year-to-date gains now stand near 52%, while silver and platinum have rallied 64% and 86%, respectively. Palladium, though less in focus, has added nearly 50%. The breadth of this move points to more than a single-asset story—it signals a rotation into tangible stores of value across the precious metals complex
The China effect: one-way flow
China’s role has been pivotal. With property prices falling for the first time in a generation, Chinese households have sought alternative assets. Gold has become a preferred vehicle, reinforced by state media campaigns promoting its role as a safe investment. The dynamic is amplified by the structure of China’s gold market: once gold is imported, it cannot be re-exported. The result is a one-way flow—an absorption of global supply that tightens international markets and limits downside pressure.
Tomorrow’s reopening of the Shanghai Futures Exchange after the Golden Week holiday will provide the next test of sentiment. Futures there are set to open roughly six percent higher, a move that could inject fresh momentum into global trading. The degree to which Chinese investors chase prices higher will help determine whether this rally can sustain its current pace or needs a near-term pause.
Fed independence and fiscal unease
Beyond the flows, politics has become a key tailwind. Concerns about the Federal Reserve’s independence ahead of the 2026 U.S. midterm elections, coupled with a prolonged government shutdown and widening fiscal deficits, have left investors questioning Washington’s ability to manage its balance sheet. The U.S. now spends more on interest payments than on defense—a statistic that underpins the appeal of holding assets that carry no counterparty risk.
Gold’s rally has thus become a mirror of waning confidence in the old financial order. For decades, investors treated U.S. Treasuries as the global risk-free benchmark. Today, the market’s message is subtler: “risk-free” and “trust-free” are no longer synonymous.
Overbought on the charts, under-owned in portfolios
From a technical standpoint, gold is stretched. The monthly relative strength index (RSI) is above 90 for the first time since the 1980s, suggesting short-term overheating. Resistance is expected in the USD 4,100–4,150 range, where some profit-taking may emerge. Yet structurally, gold remains under-owned. In major institutional portfolios, allocations to bullion still hover near multi-decade lows relative to equities and bonds.
That imbalance leaves scope for further inflows, particularly if central banks or large asset managers view recent volatility in bonds and currencies as a sign of systemic fragility. In that sense, a tactical correction of USD 200–300 would be healthy—a chance for new capital to enter rather than a signal that the rally is over.
Silver, platinum, and the catch-up trade
While gold grabs the headlines, the other precious metals have quietly built momentum. Silver, often described as gold on steroids, has lagged slightly but remains up 64% year-to-date. Traders are now eyeing the 2011 record near USD 50 per ounce as the next major target. Platinum’s 86% gain this year reflects both tightening supply and its appeal as a lower-cost alternative to gold. The gold–platinum ratio has fallen sharply from 3.5 in April to 2.44 currently but with the 5-year average near 2.15, suggesting more room for normalization if investor rotation continues.
Palladium, long the underperformer after years of overinvestment in automotive catalysts, has shown signs of stabilizing. Its 7.8% gain this past week was the strongest within the complex, though it remains well below its 2021 peaks.
Outlook: momentum meets paradigm shift
The path ahead will likely blend tactical volatility with structural strength. A consolidation phase near USD 3,800–3,900 would relieve overbought conditions without altering the longer-term uptrend. Key to sustaining momentum will be continued central-bank buying, stability in Chinese imports, and steady ETF inflows.
Beyond near-term price action, the more profound question is whether gold’s rise marks a lasting reordering of the financial landscape. If investors increasingly see political and financial systems as intertwined—and potentially vulnerable—the argument for holding unencumbered tangible assets strengthens.
Gold’s surge through USD 4,000 may therefore symbolize more than another cyclical rally. It may represent a collective reappraisal of trust, sovereignty, and what it truly means to be “safe.” In that sense, the market is not just questioning the old order—it may already be pricing in the next one.
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The instrument(s) referenced in this content may be issued by a partner, from whom Saxo receives promotional fees, payment or retrocessions. While Saxo may receive compensation from these partnerships, all content is created with the aim of providing clients with valuable information and options..