Gold surpasses $3,500/ounce, decoding the sudden fever

(Dan Tri) - Gold prices suddenly jumped to a historic peak of 3,534 USD/ounce last weekend, raising many questions about the real driving forces behind it.

August 8th was a historic day for the precious metals market. In a volatile trading session, gold prices broke all records, reaching $3,534 an ounce at one point. Although prices have since corrected slightly, the increase has brought gold’s total year-to-date gain to an astonishing 32%, far surpassing the S&P 500’s 8% gain.

This gold rush is not the result of conventional causes. It is the result of a complex combination of a policy shock, escalating geopolitical tensions and increasingly visible cracks in the global economy.

Wall Street analysts have dissected and pointed out three main drivers behind this historic price surge.

Trade policy surprise: The spark for price increases

The most immediate and unexpected trigger for the price surge is the uncertainty surrounding the gold bullion tariff policy. According to a document from the US Customs and Border Protection (CBP) on July 31, 1kg and 100-ounce gold bars, which are the most commonly traded, have been classified under a dutiable customs code.

The news has come as a shock. The market has long believed that gold, as a monetary asset, would be exempt from tariffs. If the new rules are implemented, gold bars imported from Switzerland – one of the world’s largest gold refining and production centers – could face a hefty tax.

This uncertainty immediately triggered a “panic rally,” as Susannah Streeter, head of currencies and markets at Hargreaves Lansdown, put it. “The rally shows that even safe-haven assets are not immune to volatility during times of trade policy turmoil,” she said.

The consequences for the gold market are already being felt, with the gap between U.S. gold futures and London spot prices widening to $91 an ounce. Policy uncertainty has forced at least one major Swiss refinery and several others to halt bullion exports to the U.S., disrupting the global supply chain.

The widening price gap also threatens to undermine New York's position as a gold futures trading hub, as costs there are pushed much higher than in other markets.

Although the authorities later announced that they would soon move to clarify the policy, the cloud of uncertainty still hung over the market, and turmoil ensued.

Washington could impose country-specific import tariffs on the most popular gold bars in the US, which would be a major shock to the global supply chain (Photo: Getty).

Global Instability: The "Hidden" Driver for Safe-haven Assets

In addition to policy shocks, simmering geopolitical tensions around the world are also a key factor underpinning gold’s rally. Samer Hasn, senior market analyst at XS.com, said the heightened uncertainty is fueling the precious metal.

As trade talks between major economies falter and tensions escalate in hotspots, investors tend to seek safe havens to protect their assets. "As geopolitical tensions escalate, demand for safe haven assets, especially gold, will strengthen," Hasn wrote.

In a risky world, gold has once again proven its role as the ultimate safe haven, a reliable haven when other investment channels are volatile.

Economic concerns: Cracks growing wider

A third, more fundamental driver comes from concerns about the health of leading economies. While some macro indicators are still recording growth, signs of weakness are becoming more evident, especially in the labor market.

The latest jobs figures were lower than expected. More worryingly, previous months’ figures were also revised down sharply, suggesting that the real job market is much weaker than initially optimistic assessments.

At the same time, some inflation indicators have shown signs of inching up. The combination of slowing growth and rising inflation has raised concerns about stagflation, a macroeconomic scenario that is extremely difficult to handle because high prices will prevent the central bank from loosening monetary policy to stimulate growth.

"Even conservative channels are starting to worry about the long-term consequences and the false optimism from some economic data. This concern will continue to support gold as a long-term safe haven asset and maintain the broader uptrend," said Samer Hasn.

What is the outlook for gold?

Given the current backdrop, Wall Street forecasts are generally bullish on gold.

Goldman Sachs in April raised its year-end gold price forecast to $3,700 an ounce.

Ed Yardeni, President of Yardeni Research, even believes that gold prices could hit $4,000 an ounce by the end of 2025, representing a 14% increase from current levels.

The recent gold rush is a stark reminder that in a volatile world, the value of safety and stability will always be paramount. The policy shock may be a temporary event, but the underlying geopolitical and macroeconomic dynamics will continue to underpin gold prices for the foreseeable future.

Source: https://dantri.com.vn/kinh-doanh/vang-vuot-nguong-3500-usdounce-giai-ma-con-sot-bat-ngo-20250810223633978.htm