Gold Hits New Record and Breaks $4,400, Here's What's Driving It
Gold prices hit another all-time high in today's trading after breaking through $4,400 per ounce. This surge extends gold's strong rally that has lasted throughout the year and confirms its position as a key hedge against global uncertainty.
From a fundamental perspective, the biggest driver comes from expectations of increasingly loose monetary policy. The market believes the Federal Reserve still has room to cut interest rates further, with expectations of continued rate cuts through 2026. A lower interest rate environment typically benefits gold, as it offers no interest yield, making it more attractive compared to interest-bearing assets.
In addition to interest rates, geopolitical tensions also play a significant role in driving gold prices. Increasing conflict and uncertainty in various regions—from US pressure on Venezuela, the Russia-Ukraine conflict, to tensions in the Middle East—have prompted global investors to increase their allocations to safe-haven assets. In such conditions, gold becomes a primary choice for preserving wealth.
Institutional demand is also driving price increases. Throughout this year, global central banks have continued to increase their gold reserves, while flows into gold-backed exchange-traded funds (ETFs) have remained stable. These long-term institutional purchases have created strong underlying demand and tightened the physical supply of gold in the global market.
From a technical perspective, the breakout of the psychological $4,400 level is an important signal for market participants. This level previously served as strong resistance after gold hit a record high of around $4,381 in October. Successfully breaking through and holding above this level has triggered further buying, including from momentum traders and breakout hunters.
Technically, the current gold trend remains in a strong bullish phase. As long as the price can hold above the $4,400 area, the opportunity for further strengthening remains open. The next upside target is estimated to be the $4,420–$4,440 area, while the potential for a short-term correction is considered reasonable if the price retests the former resistance area that now serves as support.
With the combination of expectations for interest rate cuts, geopolitical tensions, and consistent institutional demand, gold is considered to have a solid foundation to maintain its high level. As long as these factors persist, gold has the potential to remain one of the strongest performing assets in the global market.
Source: Newsmaker.id
