Gold Prices Surge to Record Highs
Gold Prices Surge to Record Highs
gold prices have reached unprecedented levels, surpassing $3,200 per ounce.
This surge marks a significant milestone, with gold becoming the most crowded trade among investors, surpassing even U.S. megacap tech stocks for the first time in two years.
The rally in gold prices is primarily driven by escalating trade tensions, particularly between the U.S. and China.
President Trump's aggressive tariff policies have heightened economic uncertainties, prompting investors to seek safe-haven assets like gold.
In response to these trade tensions and the potential risks associated with U.S. assets, China has significantly increased its gold reserves.
Over the past two years, China has tripled the share of gold in its foreign reserves to 8% and imported approximately 700 metric tons of gold from the UK.
Investor sentiment has shifted notably, with a Bank of America survey revealing that over 60% of institutional investors expect further depreciation of the U.S. dollar.
This pessimism is reflected in a significant reduction in exposure to U.S. equities and a marked increase in allocations to gold and other safe-haven assets.
