MARKET NEWS

Gold (GC=F)

Gold broke through the $4,400 an ounce level for the first time, hitting $4,417.53, as expectations of US interest rate cuts and strong demand for safe-haven assets fuelled a fresh rally.

Gold futures rose 1.3% to $4,442.70 an ounce, while spot gold climbed 1.6% to $4,412.23 at the time of writing.

Analysts attributed the move to growing expectations of further US rate cuts, alongside heightened geopolitical risk after US president Donald Trump and senior aides declined to rule out military conflict with Venezuela. The US has intensified its oil blockade against Venezuela, increasing pressure on the government of president Nicolás Maduro.

Tony Sycamore, market analyst at IG, said the gains were driven by “last week’s softer-than-expected US inflation and jobs reports, which reinforced expectations for two 25bp Fed rate cuts in 2026”.

He added that the rally was also supported by geopolitical tensions after Trump announced a “total and complete” blockade on sanctioned Venezuelan oil tankers and peace talks between Ukraine and Russia appeared to stall.

Bullion has risen 67% so far this year, breaking multiple records and surpassing the $3,000 and $4,000 per-ounce thresholds for the first time. It is on track for its biggest annual gain since 1979.

Gold, which does not generate a yield, tends to benefit when interest rates are falling, as the opportunity cost of holding non-interest-bearing assets declines. Expectations of easing monetary policy have strengthened after US inflation slowed in November.

However, some analysts cautioned that the rally could be vulnerable to profit-taking. “Given that gold has already risen 4% this month and we’re nearing the end of the year, bulls may want to tread with caution as volumes are to deplete and odds of profit-taking are also likely on the rise,” said Matt Simpson, senior analyst at StoneX.