The global commodities market has once again made history, as gold prices surged to an all-time high amid rising global economic uncertainty, persistent inflation concerns, and expectations of interest rate cuts by major central banks.

According to the latest data, spot gold prices on Wednesday (October 16) reached USD 4,200 per troy ounce, surpassing the previous record that had stood since early this year. This surge reaffirms gold’s position as the most sought-after safe-haven asset amid geopolitical tensions and global economic instability.

1. Key Drivers Behind the Gold Price Rally

Analysts believe that the current rise in gold prices is not merely a short-term reaction, but part of a broader, long-term trend resulting from global macroeconomic shifts.
Three main factors are fueling the rally:

a. Expectations of a Federal Reserve Rate Cut
Many market participants anticipate that the Federal Reserve will begin lowering interest rates in the coming months after inflation data showed signs of cooling. Lower interest rates make gold more attractive than interest-bearing assets like bonds, as the yield advantage of those instruments diminishes.

b. Geopolitical and Trade Tensions
Trade conflicts between the United States and China have escalated following strong statements from Washington regarding new import tariffs. This situation has heightened investor concerns and boosted demand for safe-haven assets such as gold.

c. Rising Central Bank Demand
Central banks across Asia and the Middle East have been strengthening their gold reserves as a diversification measure against U.S. dollar exposure.
Data from the World Gold Council (WGC) indicates that global central bank gold purchases rose by more than 10% in the third quarter of 2025 compared with the same period last year.

2. Impact on the Crypto and Digital Asset Market

Interestingly, the surge in gold prices has also influenced gold-backed tokens such as Pax Gold (PAXG) and Tether Gold (XAUT), which reflect the value of physical gold on blockchain networks.
Within the past 24 hours, the price of PAXG increased by nearly 3.8%, following the upward trend of global gold prices.
This reflects a growing interest in the digitalization of real-world assets (RWA), as public trust in gold’s stability as an inflation hedge continues to strengthen.

3. Global Investor Response

Global investors have begun reallocating portions of their portfolios to precious metals, particularly as major stock indices like the S&P 500 and Nasdaq exhibit high volatility amid uncertainty surrounding U.S. fiscal policy.
According to Reuters, inflows into gold-based exchange-traded funds (ETFs) have risen sharply since early October. Investment vehicles such as SPDR Gold Shares (GLD) recorded a gold holdings increase of up to 1.2 million ounces in the past two weeks — the highest level since the 2020 pandemic.
Retail investors in Asia, especially in India and China, have also shown a notable surge in physical gold demand ahead of the wedding season and year-end celebrations, historically periods of peak gold consumption.

4. Potential Price Outlook

Although gold prices are currently at record highs, analysts believe there is still room for further gains.
A report from Bloomberg Intelligence suggests that if global monetary easing continues and geopolitical tensions persist, gold prices could climb to USD 4,500 per troy ounce by the end of this year.
However, some analysts caution that short-term corrections could occur if the Federal Reserve delays rate cuts or if the U.S. dollar strengthens again.

5. Conclusion: Gold Remains the Ultimate Symbol of Financial Security

The surge in gold prices to a new record underscores its enduring role as the most trusted store of value — favored by financial institutions, central banks, and retail investors alike.
Amid the turbulence of the global economy, gold continues to prove its reliability as a stable asset, even in an era increasingly dominated by digital and financial technologies.