Gold reached $4,383.76 per ounce on Monday, breaking the record high set in October, as investors anticipate the US Federal Reserve will continue to cut interest rates next year.
A series of data last week showed declines in the US labor market and a slowdown in inflation, making it likely the US central bank will implement further monetary policy easing.
Investor Demand for Gold
A series of factors in recent months, such as US government paralysis, the trade war initiated by former President Donald Trump, and geopolitical risks, have fueled investor demand for gold, which serves as a safe haven amid declining confidence in the US dollar.
The price of the precious metal reached $4,381.52 per ounce in October, a 67% increase from the start of the year, but it quickly retreated by 5% due to profit-taking by investors.
Gold
Gold is not a specific place or cultural site, but a precious metal that has been mined and treasured by civilizations worldwide for thousands of years. Historically, its discovery has driven exploration, economic systems like the gold standard, and significant cultural events such as gold rushes in places like California and Australia.
US Federal Reserve
The US Federal Reserve, established in 1913, is the central banking system of the United States, created to provide a safer and more stable monetary and financial system. Its key functions include conducting national monetary policy, supervising and regulating banks, and maintaining financial stability.
US labor market
The US labor market refers to the supply and demand for labor within the United States, shaped by economic cycles, technological change, and policy decisions. Its history includes major transformations from agricultural to industrial and now service-based employment, alongside evolving labor laws and union movements.
US government
The US government is a federal republic established by the Constitution in 1787, creating a system of three co-equal branches: the legislative (Congress), executive (President), and judicial (Supreme Court). Its structure was designed to balance power between the federal government and the states, with a history shaped by amendments, court rulings, and evolving interpretations of its founding principles.
US dollar
The US dollar is the official currency of the United States, established by the Coinage Act of 1792. It evolved from a system based on Spanish milled dollars and has become the world’s primary reserve currency since the 1944 Bretton Woods Agreement.
