Gold price hits record high above $4,500 on safe-haven demand

Gold prices soared to a record high on Wednesday, breaching the $4,500 per ounce barrier for the first time as investors sought safe-haven assets. The precious metal peaked at $4,525.96 an ounce, marking a nearly 1% daily gain and an extraordinary 72% increase over the past year.

Silver rally and economic backdrop

Silver also experienced a significant rally, rising over 1% to reach $72.7 per ounce, a historically high level representing a 144% annual surge. This rally occurs against a complex economic backdrop, including concerns over slowing global growth and anticipation of further U.S. Federal Reserve interest rate cuts in 2026, despite recent strong U.S. GDP data showing 4.3% annualized growth in the third quarter.

Geopolitical tensions fueling the surge

Escalating tensions between the United States and Venezuela are a key driver of the rally. Increased U.S. surveillance and enforcement against Venezuelan oil shipments have raised fears of disruptions to global crude supplies, adding to market unpredictability. These geopolitical risks, alongside allegations from U.S. President Donald Trump regarding Venezuela's use of oil revenues, have heightened demand for traditional safe-haven assets like gold and silver.

Central bank buying and future outlook

Another major factor underpinning gold's strength is sustained buying by global central banks aiming to diversify and bolster their foreign reserve holdings. This institutional demand, combined with retail investor interest, suggests the bullish trend for precious metals may continue amid ongoing economic and geopolitical uncertainty.