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The rally follows increasing fears that the tech-driven surge in global equity markets may have gone too far, fueling talk of a potential asset bubble. Gold has gained more than 50 percent since the start of the year, supported by economic uncertainty, trade tensions under Donald Trump, and global geopolitical crises.
Adding to gold’s momentum, political instability in France — marked by the resignation of the prime minister and calls for President Emmanuel Macron to step down — intensified investors’ flight to safety.
Despite the U.S. dollar strengthening against most major currencies, gold climbed to an all-time high of $4,006.68, while silver also neared its own record. The partial U.S. government closure has delayed key economic data, complicating the Federal Reserve’s policy decisions.
Analyst Taylor Nugent of National Australia Bank noted that gold’s rapid rise is driven by ETF inflows and central bank purchases, especially from China, as the metal benefits from political, economic, and inflation-related uncertainties.
While gold surged, Asian equity markets showed restraint. Investors questioned the massive AI-driven investments, with Nvidia’s valuation surpassing $4 trillion. However, Oracle’s disappointing cloud profit margins rattled markets, dragging Wall Street indexes into the red.
As Stephen Innes of SPI Asset Management remarked, “In a market priced for perfection, any delay in cash flow — even a temporary one — feels like the bartender calling ‘last call’.” Traders began unwinding positions, and tech shares led the selloff across Asia, particularly in Hong Kong, Taipei, Sydney, and Singapore.
Tokyo’s markets showed marginal gains, supported by optimism that Sanae Takaichi’s leadership of Japan’s ruling party could usher in economic stimulus and monetary easing, providing a rare bright spot in otherwise cautious global trading.
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