Gold prices surged to a fresh all-time high on Monday as investors piled into the precious metal on growing expectations that the United States Federal Reserve will continue cutting interest rates next year, while geopolitical tensions added to demand for safe-haven assets.
The metal climbed as high as US$4,383.76 an ounce in early trade, edging past its previous record of US$4,381.52 set in October, according to market data. The rally followed a run of US economic figures pointing to a cooling labour market and easing inflation, which traders say gives policymakers room to loosen monetary policy further.
Gold tends to benefit from lower interest rates, which reduce the opportunity cost of holding non-yielding assets, as well as from periods of heightened uncertainty.
Investors have ramped up bets that the US Federal Reserve will resume rate cuts early next year after data last week showed US unemployment rose to a four-year high in November, while another report indicated consumer price pressures eased more than expected.
“The labour market softening and inflation moderation strengthened Federal Reserve easing expectations for 2026,” said Fabien Yip, a market analyst at IG.
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However, Yip cautioned that the slowdown in inflation might not be permanent. “The low inflation reading may prove temporary as shutdown-related data collection disruptions likely suppressed the figure, which could normalise higher once data gathering processes resume,” she said.
Geopolitical concerns also lent support to gold prices. Markets remain on edge as Washington tightens its oil blockade against Venezuela, while tensions flared further after Ukraine struck a tanker linked to Russia’s so-called shadow fleet in the Mediterranean. Such developments often push investors toward assets perceived as stores of value during periods of global stress.
The rally in gold came as Asian equity markets advanced broadly, buoyed by optimism over US rate cuts and a renewed surge in technology stocks. Investors returned to risk assets during the final full trading days before Christmas, after earlier jitters over the prospect that the Fed might delay further easing into 2026.
Shares in major Asian technology firms led gains, including South Korea’s Samsung Electronics, Taiwan’s TSMC and Japan’s Renesas. Markets in Hong Kong, Shanghai, Sydney, Seoul, Singapore, Mumbai, Bangkok, Wellington, Taipei and Manila all posted solid advances.
Tokyo was the standout performer, rising about 1.8 percent as a weaker yen boosted exporters’ shares.
“Asian equity markets are stepping onto the floor with a constructive bias, taking their cue from Friday’s solid rebound in US stocks and the growing belief that the final stretch of the year still belongs to the bulls,” said Stephen Innes of SPI Asset Management.
The gains followed a strong finish on Wall Street, where technology stocks powered higher. The Nasdaq was lifted by upbeat earnings from US chipmaker Micron Technology, which helped reignite enthusiasm around artificial intelligence investments.
Sentiment was further supported by news that Oracle will take a 15 percent stake in a TikTok joint venture, a move expected to allow the popular social media platform to continue operating in the United States.
The rebound in tech shares came after a recent bout of selling driven by concerns that valuations had become stretched and that massive spending on AI could take time to generate returns.
In currency markets, traders were closely watching Japan after senior officials voiced concern over the yen’s recent weakness. Japan’s vice finance minister for international affairs, Atsushi Mimura, warned on Monday that authorities were monitoring “one-directional, sudden moves” following last week’s policy meeting.
“We’d like to take appropriate responses against excessive moves,” Mimura said, fuelling speculation that Tokyo could intervene to support the currency. The yen fell more than one percent against the dollar on Friday after the Bank of Japan raised interest rates to a 30-year high but signalled caution on further increases.
Meanwhile, European markets opened lower, with London, Paris and Frankfurt slipping in early trade, as investors weighed the implications of global monetary policy shifts and ongoing geopolitical risks.
For now, analysts say gold’s record run underscores how expectations of looser US policy and persistent global uncertainty continue to shape investor behaviour heading into the end of the year.
