Mumbai: Gold prices surged to unprecedented levels on Wednesday, approaching $4,200 per ounce, marking a historic high for the precious metal. Spot gold reached $4,186.68 before settling at $4,178.15, while U.S. gold futures climbed to $4,197.50. This rally comes amid growing expectations of U.S. Federal Reserve interest rate cuts and renewed trade tensions between the United States and China.

Investors have been responding to signals from the Federal Reserve, with Chair Jerome Powell noting a softer labor market and suggesting that interest rate decisions will be made on a meeting-by-meeting basis. Traders are now anticipating a 25-basis-point rate cut in both October and December, a move that typically boosts gold’s appeal as a non-yielding asset.

At the same time, escalating trade disputes between the U.S. and China, including possible tariffs and export restrictions, have heightened market uncertainty. The ongoing U.S. government shutdown has further added to economic concerns, pushing investors toward safe-haven assets like gold. Central banks around the world have also been increasing their gold reserves, while the trend of de-dollarization is strengthening demand for the metal.

Other precious metals have mirrored gold’s strong performance. Silver prices have risen to $53.60 per ounce, while platinum increased to $1,677 and palladium climbed to $1,505.75. Analysts expect gold to continue its upward trajectory, with some forecasts suggesting it could reach $5,000 per ounce by 2026, though a short-term correction remains possible.

The combination of Federal Reserve policy shifts, geopolitical tensions, and robust central bank demand is fueling gold’s historic rally. Investors are closely monitoring these developments as global economic uncertainties continue to unfold.