Gold Breaks Above $4,200 for the First Time as Global Markets Rally

Gold surged past $4,200 per ounce for the first time in history, setting a new record on global markets as investors bet on further U.S. rate cuts and sought safety amid geopolitical uncertainty. According to Bloomberg, spot gold climbed 1.4% to $4,200.11 per ounce, while December futures reached $4,218. The rally reflects growing confidence that the Federal Reserve will ease policy later this year. Renewed tensions between the United States and China have also pushed investors back toward traditional safe havens.

A Historic Milestone Driven by Fed Policy and Global Tensions Gold has risen 59% since the start of 2025, supported by expectations of lower interest rates, central bank purchases, and the ongoing global shift away from the U.S. dollar. Analysts also point to strong inflows into gold-backed ETFs, which have turned the metal into one of the most popular trades of the year. “Government shutdown concerns and Jerome Powell’s dovish comments have given gold another boost,” said Matt Simpson, chief analyst at StoneX. Bloomberg noted that major institutions have invested billions into gold ETFs, making it the “safe trade of 2025.”

Precious Metals Extend Gains Other metals joined the rally. Silver rose 2% to $52.48 an ounce after Tuesday’s record of $53.60. Platinum gained 1.3% to $1,658.65, while palladium added 0.9% to $1,538.75. Investors continue to favor precious metals as protection against inflation and financial instability.

Stocks Recover as Markets Adjust to Policy Shifts While gold set new records, global equity markets traded mostly higher. Europe and Asia advanced, while U.S. indices remained volatile after President Donald Trump threatened an embargo on Chinese cooking oil over suspended soybean imports. The S&P 500 closed down 0.2%, the Nasdaq Composite fell 0.8%, and the Dow Jones gained 0.4% after an early decline of more than 1%. Futures on the Dow were up slightly, while S&P 500 and Nasdaq 100 futures were little changed.

Europe and Asia Rebound, China Struggles with Deflation After two weeks of declines, European markets turned positive. The Stoxx 600 rose 0.7%, France’s CAC 40 added 2.4%, Italy’s FTSE MIB gained 0.7%, Germany’s DAX climbed 0.2%, and the UK’s FTSE 100 was flat. In France, Prime Minister Sébastien Lecornu announced that his government would postpone pension reform until after the 2027 elections, a decision that helped calm political tensions and stabilize markets. Asian markets opened sharply higher. Japan’s Nikkei 225 rose 1.76%, South Korea’s Kospi climbed 2.68%, and Hong Kong’s Hang Seng advanced 2.06%. Australia’s ASX 200 gained 1.03%, while India’s Nifty 50 rose 0.74%. The only major laggard was China, where consumer prices fell 0.3% year over year in September, marking another month of deflation. Producer prices remained negative, highlighting the challenges facing President Xi Jlnping’s efforts to restore economic confidence.

The Return of the “Safe Haven” Era Analysts agree that gold’s rise reflects declining faith in the dollar and a renewed search for tangible stores of value. With investors preparing for a lower-rate environment, gold is regaining its role as the “currency of last resort.” If the Fed moves ahead with another round of rate cuts, some forecasts see gold reaching $4,500 per ounce before year-end. “The market is clearly positioning for lower rates, and that’s exactly where gold thrives,” said Simpson of StoneX.

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