Gold has achieved a new historical milestone, surpassing the $4,000 per ounce level for the first time ever on October 8, 2025. This marks the 46th price increase since the start of the year, bringing it closer to achieving its best annual performance since 1979, according to a recent report by the World Gold Council (WGC).
The report highlights that the journey from $3,500 to $4,000 took only 36 days, making it the fastest jump among gold's historical rallies. This surge is fueled by increased investment demand, rising central bank purchases, a weakening US dollar, and expectations of a US interest rate cut.
Drivers of the Rally: Safe Investment in a Volatile World
The report explained that the latest rally is led by Western market investors rushing into safe assets amid geopolitical tensions, the depreciation of the US currency, and growing fears of a sharp correction in stock and bond markets.
Central bank purchases have also contributed to boosting demand, not only in terms of physical quantities but also by reinforcing confidence in gold as a long-term strategic asset.
The report noted that gold has attracted an additional $21 billion in investment inflows since the end of last August, bringing the total inflows into physically-backed gold ETFs to $67 billion since the start of the year.
Market Indicators: Gold ETFs Nearing Historical Peak
Global investment fund holdings have risen to 3,857 tonnes of gold, which is only 2% shy of the November 2020 peak of 3,929 tonnes.
Despite these strong figures, the World Gold Council asserts that the market is still at the beginning of a new accumulation cycle. The duration of the current rally has not exceeded 74 weeks, compared to previous surges that lasted over 250 weeks. In other words, what we are witnessing today is not the end of the rally, but its beginning.
Does Gold Still Have Room to Run?
The report believes that the fundamental factors remain supportive of gold's upward trajectory, anticipating continued US dollar weakness, a decline in real interest rates, and increased volatility in global financial markets.
Conversely, the WGC warns that the rapid rise in prices may lead to temporary profit-taking, technical indicators signaling overbought conditions (RSI above 90), portfolio rebalancing, and a slowdown in consumer demand during the traditional buying season. However, these are viewed as short-term factors that will not alter the long-term, supportive trend for gold.
Long-Term Strategic Factors
The report outlines several long-term factors:
Expansion of the investor base through new financial tools such as low-cost funds and smaller contracts in China and India.
Continued structural weakness in the US dollar.
US policy uncertainty and escalating geopolitical risks.
The potential for an economic recession with slowing growth and rising public debt.
The report emphasizes that comparing the current situation to the 1979 boom is "tempting but inaccurate," as the current landscape reflects a structural shift in the global financial system, not merely a short-term speculative cycle.
$4,000 is Not the End, But the Beginning
The World Gold Council concludes its report by affirming that gold still has the momentum to continue its ascent. The events of October 2025 are not a market peak but a new phase of re-pricing the metal in line with a changing economic and geopolitical reality.
In a world where confidence in paper currencies is declining and geopolitical risks are widening, gold appears to be writing a new chapter in its history as the safe haven that balances the storm and history.
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