On Monday, 22 September, gold climbed above $3,720 per ounce, rewriting historical records and sparking the main debate of the autumn: will the rally continue toward $4,000, or are we witnessing an overheated market?
Bloomberg analysts describe the combination of factors – the Federal Reserve’s dovish policy, trade wars, and inflation concerns – as “a perfect storm for gold.” In their view, it is precisely the mix of rate cuts and uncertainty around global trade that has triggered a powerful inflow of capital into precious metals. On 17 September, Deutsche Bank published a forecast stating that the price of gold will reach $4,000 by 2026. Economists emphasise that dollar weakness and central bank purchases “are creating an unprecedented foundation for further growth.”
A similar scenario was discussed by Investopedia, noting that undermining the independence of the U.S. Federal Reserve and a loss of confidence in the dollar could sharply accelerate capital flows into gold. The Economic Times allows for the possibility of prices rising to $5,000 if the outflow from U.S. Treasuries intensifies and central banks continue active buying. In both cases, these are stress scenarios rather than the base case. This view fully coincides with that of Goldman Sachs economists. In a recent report, they agreed that “$4,000 looks entirely realistic in the base case,” but clarified that “reaching $5,000 is only possible under a set of extreme circumstances.”
Reuters notes that the market is already pricing in not one but several future rounds of Fed easing, which deprives the dollar of support and enhances gold’s appeal. However, the agency cautions: “Overbought conditions are obvious, and any strong macroeconomic data could trigger a rapid correction.” James Steel, Chief Precious Metals Analyst at HSBC, expressed a similar view: “Yes, gold is currently acting as a strategic hedge, but a drop of several hundred dollars cannot be ruled out if inflation expectations stabilise.”
In Asia, both China and India are supporting demand, in the retail sector as well as at the level of state purchases. This creates a solid foundation, but volatility is still possible. According to the World Gold Council, retail demand in India tends to weaken with every significant price surge, which means that around $3,700-3,800 a “buyer fatigue” effect may appear.
Nevertheless, interest in gold is rising among private investors. Many funds and consultants recommend holding between 5 and 15% of portfolios in precious metals. Goldman Sachs analysts point out: “With a weak dollar, gold remains one of the few universal defensive strategies.” UBS holds a similar position, stressing that gold is “not only a hedge but also a long-term means of preserving value in an environment of geopolitical turbulence.”
In the retail market, online platforms for CFD and metals trading are attracting special attention. XFINE reports that “with daily moves of tens of dollars, gold becomes the arena for aggressive short-term strategies.” For several months, XFINE clients have been earning their highest profits precisely from trading the XAU/USD pair, reflecting this instrument’s unique volatility and high liquidity. Traders emphasise that the platform enables swift reactions to news, but also warn that high leverage and a lack of discipline in risk management can quickly lead to capital losses. XFINE analysts, like their peers, forecast a rise in prices to $4,000, while also allowing for a correction to the $3,580-3,600 or even $3,500-3,525 levels in the event of higher U.S. Treasury yields and a stronger dollar.
XFINE experts also remind investors that gold is not the only precious metal to be used as a hedge. Silver is traditionally seen as gold’s “younger brother” and is more sensitive to industrial demand. Its price is driven not only by inflation fears but also by growth in solar power and electronics production. Many experts see silver as having a “dual function” – a defensive asset and an industrial metal. Platinum remains more niche, but rising interest in hydrogen energy and the automotive sector could increase its significance. However, platinum is more volatile and less liquid than gold, making it a less universal hedge for portfolios.
Thus, gold at $3,720 is both a symbol of crisis-driven fear and an indicator of global demand for safe-haven assets. For some, it represents the continuation of a long-term trend and the chance to see $4,000 by year-end; for others, it is a bubble that may burst at the first wave of positive data. Yet regardless of perspective, gold’s role as a strategic instrument in investor portfolios and as a tool for active trading is undeniable. According to XFINE analysts, the ongoing debate over $4,000 or even $5,000 only underscores that ignoring gold in today’s climate of global instability is impossible.
