Rudolph Angler Gold prices have soared past $2,870 per ounce, driven by central bank purchases, inflation fears, and rising trade tensions.
The gold rally has climbed nearly 10% since January, marking the fastest increase since 1980. Investors now question whether this marks the start of a lasting gold bull market or a temporary spike. Gold’s rise is fueled by mounting government debt, inflation risks, and economic deglobalization.
Crescat Capital strategist Otavio Costa likened today’s gold market to past economic crises, citing debt concerns from the 1940s, inflation issues from the 1970s, and overvalued assets reminiscent of the 1920s and 1990s.
Central banks have accelerated gold purchases, acquiring over 1,000 tonnes in 2024 alone, according to the World Gold Council.
Goldman Sachs reports that demand from central banks has surged fivefold since 2022, following the freezing of Russia’s assets.
The Trump administration’s 10% tariff on Chinese imports has added to investor demand for safe-haven assets.
China has retaliated with countermeasures, including tariffs on US goods and restrictions on critical minerals.
Reports indicate that the London gold market is facing shipment delays, with traders scrambling to borrow bullion amid rising US demand.
However, analysts, including Metals Daily CEO Ross Norman, dismiss fears of a fundamental gold shortage, calling the disruptions temporary logistical bottlenecks.
While gold dominates headlines, silver is emerging as a potential high-growth investment.
Unlike gold, silver has industrial uses, making it a hybrid between a commodity and a precious metal.
Analysts suggest silver is undervalued relative to gold, with expected global industrial production growth likely to boost demand.
Despite gold’s sharp rise, investor sentiment remains subdued, with ETF outflows and limited retail investor activity, suggesting further upside potential.
Whether this rally marks the start of a new gold era or just another cycle remains uncertain, but for now, investors are betting big on bullion.