Gold raced past $4,000 an ounce for the first time on Wednesday as investors piled into a historic rally in the safe haven to hedge against global economic and geopolitical uncertainties, while also betting on U.S. interest rate cuts, AZERTAG reported.
Spot gold was up 1.4% at $4,039.10 per ounce by 0820 GMT. U.S. gold futures for December delivery gained 1.4% to $4,061.80.
Silver also latched on to gold's rally, gaining 2% to $48.76 per ounce, and just down from its all-time high of $49.51.
Traditionally, gold is seen as a store of value during times of instability. Spot gold is up about 54% year-to-date, after rising 27% in 2024. It is one of the best-performing assets of 2025, outpacing gains in global equity markets and bitcoin and losses for the U.S. dollar and crude oil.
The rally has been driven by a cocktail of factors, including expectations of interest rate cuts, ongoing political and economic uncertainty, solid central bank buying, inflows into gold exchange-traded funds and a weak dollar.
"Background factors are much the same as before, in terms of geopolitical uncertainty, with the added spice of the government shutdown," StoneX analyst Rhona O'Connell said.
"The latter is not impeding strong equities but nonetheless there will be a degree of risk mitigation via bullion."
The ongoing U.S. government shutdown, now in its eighth day on Wednesday, has delayed the release of key economic data, forcing investors to rely on non-government sources to assess the timing and scope of Fed rate cuts.
Markets are pricing in a 25-basis-point rate cut at the Fed's upcoming meeting, with a similar reduction expected in December.
Global crises, including the Middle East conflict and the war in Ukraine, have also contributed to increased demand for bullion, with political turmoil in France and Japan further amplifying the rush for safe-haven assets.
Renewed accumulation of developed-market exchange-traded funds (ETFs) for the first time in five years is also among the factors boosting this rally, said Michael Hsueh, precious metals analyst at Deutsche Bank.