Gold prices surge past $4,000 for the first time as investors seek safety from inflation

October 08, 2025 (MLN): Gold prices climbed above $4,000 per ounce for the first time on Tuesday, as investors poured into the precious metal amid a weakening U.S. dollar, mounting geopolitical tensions, and persistent inflation.

Spot gold was up  1.66% at $4027.88 an ounce as of [10:09 am] PST, according to data reported by Mettis Global.

Gold futures settled at a record $4,004.40 per ounce, after touching an intraday high of $4,014.60.

The metal has soared nearly 50% so far this year, driven by safe-haven demand as the U.S. dollar index dropped 10% and President Donald Trump’s trade and monetary policies fueled market uncertainty.

Central banks and retail investors have been aggressively accumulating gold. Nations such as China are diversifying reserves away from U.S. Treasurys, especially after Washington’s sweeping sanctions on Russia following its 2022 invasion of Ukraine, according to CNBC.

Individual investors are also seeking protection against stubbornly high inflation.

The latest rally came on the heels of the Federal Reserve’s September rate cut, its first of 2025, which made short-term government debt less appealing.

Markets now anticipate two more reductions in the federal funds rate, currently in the 4.00%–4.25% range, before year-end. The Fed’s next policy meeting is scheduled for October 29.

Prominent hedge fund manager Ray Dalio, founder of Bridgewater Associates, advised investors on Tuesday to allocate roughly 15% of their portfolios to gold, calling traditional debt investments “not an effective store of wealth,” CNBC noted.

“Gold is the one asset that performs well when the typical parts of your portfolio go down,” Dalio said at the Greenwich Economic Forum in Connecticut.

However, not all analysts are bullish. Bank of America on Monday urged caution as gold approached the $4,000 mark, warning of potential “uptrend exhaustion” that could trigger a price correction or consolidation later this year.

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