Gold records its best price increase in 46 years.

Gold is experiencing its best year since 1979. So far this year, the price of gold futures in New York has accumulated nearly a 71% increase, potentially setting the best annual gain in 46 years. At the beginning of this year, the price of gold futures was around $2,640 per ounce. This Monday, the price of gold briefly surpassed the historical high of $4,500 per ounce. The 71% increase far outperforms the S&P 500 index, which has only risen by 18%. In 2024, gold futures rose by 27%, while the S&P 500 index rose by 24%. The last time gold had such a strong annual performance, the president of the United States was Jimmy Carter, and the Middle East was in turmoil, inflation was soaring, and the United States was deeply embroiled in an energy crisis. This year, tariffs have disrupted international trade, the conflict between Russia and Ukraine continues to escalate, tensions between Israel and Iran have erupted multiple times, and the United States has detained oil tankers near Venezuela. In highly uncertain times, investors often turn to safe-haven assets like gold. Gold is seen as a resilient investment tool, and investors generally believe that this metal can maintain its value during times of crisis, skyrocketing inflation, or currency devaluation. Joe Cavatoni, Senior Market Strategist at the World Gold Council, stated, "Uncertainty remains a prominent feature of the global economy. In such an environment, gold is becoming increasingly attractive as a strategic diversification tool and a stable source." For some investors, the downside of gold is that it does not generate interest income like bonds. However, when the Federal Reserve lowers interest rates as it has in recent months, bond yields usually decline, increasing the relative attractiveness of gold. Gold is expected to continue its strong performance The strong performance of gold has also driven up other precious metals, including silver, platinum, and palladium. So far this year, silver futures have surged by 146%, platinum futures have risen by nearly 150%, and palladium futures have increased by 100%. Hakan Kaya, Portfolio Manager at Neuberger Berman, stated that precious metals are a "hedging tool for investors to cope with an increasingly uncertain world." This trend may continue. Ulf Lindahl, CEO of Currency Research Associates, predicts that the price of gold will continue to rise in 2026. As central banks increase their gold reserves, the amount of gold bars available on the market may decrease; with a rising demand from retail investors and limited supply, prices may rise further. Matt Maley, Chief Market Strategist at Miller Tabak + Co., pointed out that concerns about massive government fiscal deficits and debt burdens are also driving demand for precious metals up. "As investors become more aware of these issues, they are increasingly viewing gold as an important safe haven," Maley said. Analysts at JPMorgan Chase predict that by 2026, gold prices could rise to over $5,000 per ounce. This article is reproduced from "Cai Liang She", written by Xia Junxiong; GMTEight Editor: Feng Qiuyi.