Gold powered to a fresh record on Wednesday, briefly touching US$4,026.69 per ounce in Asian trade and holding near US$4,025 by early afternoon in Singapore, as a rush for havens collided with mounting political pressure on the U.S. Federal Reserve. Multiple benchmarks confirmed the milestone, with spot prices cresting US$4,000 and U.S. futures trading above US$4,040.
The move caps a dramatic year in which bullion has already risen by more than 50%, building on 2024’s surge and extending a multi-year march through key psychological levels: US$1,000 during the global financial crisis, US$2,000 amid the pandemic, US$3,000 in March 2025, and now US$4,000. Analysts cite a cocktail of drivers: an extended U.S. government shutdown that has muddied economic visibility, expectations of Fed rate cuts, a softer dollar, robust central-bank buying and accelerating inflows into gold-backed funds.
Markets were already on edge. Asian equities slipped on Wednesday as political jitters in France and Japan added to the gloom, while gold’s break into four-handle territory underscored the search for safety. Spot prices around US$4,021 at one point helped cement bullion as one of 2025’s standout assets.
Politics meets policy
The latest leg higher coincides with an extraordinary confrontation between the White House and the U.S. central bank. President Donald Trump has escalated attacks on Fed independence, seeking to oust Governor Lisa Cook and publicly berating Chair Jerome Powell. The administration has asked the U.S. Supreme Court for an emergency order to remove Cook after lower courts blocked the move; the justices have allowed her to remain in post for now and set arguments for January. Investors read the episode as a direct challenge to the Fed’s autonomy, amplifying safe-haven demand.
What’s driving flows into gold now
- Policy uncertainty: A prolonged U.S. government shutdown has delayed data releases and clouded the outlook for monetary policy, pushing traders to lean on alternative indicators and hedge with gold.
- Rate-cut bets & the dollar: Growing conviction that the Fed will ease further—against a backdrop of fiscal strains—has depressed real yields and supported bullion; dollar softness has added fuel.
- Official & institutional buying: Central banks remain steady buyers, while ETF inflows have accelerated, reinforcing the uptrend and helping prices slice through technical ceilings.
- Geopolitics: Political shifts in Japan, instability in France, and broader global flashpoints have strengthened the bid for defensive assets.
What to watch next
- Supreme Court calendar: Any court action shaping the Cook case—or further political rhetoric aimed at the Fed—could jolt rate expectations and haven demand.
- Profit-taking around US$4,000: Strategists warn that such a round-number breakout often invites sharp, if temporary, reversals; dips towards recently established support zones would test the depth of new-money demand.
- ETF flows and central-bank purchases: Sustained inflows would validate the move; a reversal would leave prices vulnerable to a pullback.
For now, bullion’s clean break into uncharted territory—set against the rare spectacle of an American president openly challenging his central bank—has put gold squarely at the heart of the global risk narrative. Whether the next act is consolidation or an advance towards fresh targets will hinge on politics as much as policy.