By Swann Collins, investor, writer and consultant in international affairs – Eurasia Business News. October 7, 2025. Article no 1820
Gold price crossed $4,000 per ounce for the first time ever in history, reaching as high as about $4,006 today before a slight dip and then bouncing back at $ 3,980.
This milestone represents more than a 50% increase in gold’s value so far in 2025, marking the highest return in 12 months since 1979, outpacing rallies during the pandemic and 2007-09 recession.
The surge in gold prices is driven by multiple factors including ongoing U.S. government shutdown, persistent inflation above 2.9% (higher than the Federal Reserve’s 2% target), a weakening U.S. dollar (down 10% year-to-date), geopolitical tensions, global economic uncertainties, and expectations of further interest rate cuts by the Federal Reserve.
Significant purchases by central banks, particularly China adding gold to its reserves for the 11th consecutive month, along with increased buying by retail investors and institutions, also contributed to this rise. Central banks bought 415 tons of gold in the first half of 2025, according to the World Gold Council. The environment of market uncertainty and inflation concerns has made gold a favored safe haven asset and store of value.
Gold has traditionally served as a safe-haven asset, and its appeal has increased amid rising geopolitical tensions and economic uncertainties. The ongoing conflicts and global economic instability have driven investors to seek refuge in gold, contributing to its price rise.
Gold is a long-term store of value and this storage capacity is standardized internationally. Each troy ounce of gold has the same value. The yellow metal is an asset with intrinsic value in itself, capable of maintaining its purchasing power throughout the centuries and around the world.
Prominent investment figures like Ray Dalio have advised allocating about 15% of portfolios to gold, emphasizing its role as a diversifier and reliable asset when other portfolio components decline. However, some analysts, including Bank of America, have cautioned about a possible consolidation or correction after this rapid rise.
Read also : Five Good Reasons to Own Gold Now
Global physically backed gold ETFs recorded their largest monthly inflow in September, resulting in the strongest quarter on record of US$26bn, reported the World Gold Council last week. North American investors led the charge for most of the quarter; at US$16.1bn, the inflow represents the largest Q3 and second largest quarter on record. European funds also saw hefty buying and registered the region’s second-strongest quarter (US$8.2bn), coming in just US$74mn shy of their record set in Q1 2020. Asia buying slowed during the quarter (US$1.7bn), while funds in other regions (US$28.2mn) were relatively flat.
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© Copyright 2025 – Eurasia Business News. Article no. 1820
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