Gold glitters at record $4,300 as investors rush to safety

WASHINGTON: Gold soared past the historic mark of $4,300 an ounce on Friday, putting it on track for its strongest weekly performance in five years.

A mix of global economic anxieties, including weakness in US regional banks, renewed trade tensions, and growing expectations of further interest rate cuts, pushed investors towards the traditional safe haven.

As of 0233 GMT, gold was trading 0.3 percent higher at $4,336.18 per ounce, after briefly touching a new all-time high of $4,378.69 earlier in the session. US gold futures for December delivery climbed 1 percent to $4,348.70.

The precious metal has surged about 8 percent this week alone, marking its best performance since March 2020. Analysts say that gold’s next target could be around $4,500 if the ongoing economic concerns persist.

“Much depends on how long the worries surrounding US-China trade and the potential government shutdown continue,” one market expert noted.

Silver and other precious metals

While gold shone bright, silver slipped 0.7 percent to $53.86 per ounce. However, it remained on track for a weekly gain after earlier hitting a record high of $54.35. The rally in gold and a short squeeze in the spot market helped silver maintain strong momentum through the week.

Platinum also fell 0.7 percent to $1,701, and palladium dropped 0.4 percent to $1,607.93, though both metals were still heading for weekly gains.

Market sentiment and global backdrop

Concerns about the health of US regional banks have rattled investor confidence, adding another reason for traders to buy gold. Wall Street ended lower on Thursday as financial shares took a hit, while geopolitical jitters continued to ripple through global markets.

Adding to the tension, China accused the US of sparking panic over its rare earth export curbs, rejecting calls to roll back restrictions. Meanwhile, the Federal Reserve’s dovish tone also supported gold’s rally.

Fed Governor Christopher Waller voiced support for another interest rate cut, citing concerns about the labour market. Investors are now anticipating a 25-basis-point reduction at the Fed’s upcoming October 29–30 meeting, with another cut possibly in December.

Non-yielding bullion tends to thrive in lower interest rate environments, and this year has been no exception. Gold has gained more than 65 percent since the start of the year, fuelled by geopolitical uncertainty, aggressive rate-cut bets, central bank buying, de-dollarisation efforts, and strong inflows into gold-backed exchange-traded funds.

On the political front, US President Donald Trump and Russian President Vladimir Putin agreed to hold another summit on the Ukraine war, while Western nations continued to tighten sanctions on Russia’s oil industry.

Gold price surge in Pakistan

In line with the global trend, gold prices in Pakistan rose sharply on Thursday. According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of gold per tola increased by Rs1,900 to reach Rs442,800 in the local market. The rate for 10 grammes of gold stood at Rs379,629 after gaining Rs1,629 during the day.

On Wednesday, the price had dropped by Rs4,578 to Rs420,600 per tola. The international rate, meanwhile, rose to $4,217 per ounce, including a $20 premium, marking a gain of $19, according to APGJSA.

Silver prices, however, remained unchanged at Rs5,337 per tola.