The price of %Gold (TVC: $GOLD) has hit a fresh record and risen above $3,700 U.S. an ounce for the first time as the rally in the precious metal continues unabated.
The latest leg higher in the price of gold comes with the U.S. Federal Reserve expected to deliver its first interest rate cut of the year on Sept. 17.
Lower interest rates reduce the opportunity cost of owning gold, which is viewed as a store of value and counter to the U.S. dollar.
With the U.S. central bank widely expected to lower interest rates by 25-basis points, it is giving added fuel to gold’s rally, which has been ongoing for over a year now.
In fact, gold’s price has hit record highs on more than 30 occasions this year. In March, the price topped $3,000 U.S. an ounce.
Now, many commodities analysts say they expect gold’s price to be above $4,000 U.S. an ounce by year’s end or in early 2026.
It’s been quite a bull run for gold, which, as recently as 2019, was trading at $1,300 U.S. per ounce, a level it had been at for nearly a decade.
In addition to lower interest rates, gold’s price has been rising steadily amid a flight to safety among investors worried about macroeconomic and geopolitical uncertainty.
Both retail and institutional investors have also shifted capital into gold and away from the U.S. dollar, which has fallen to its lowest level since the early 1970s.
At the same time, central banks around the world have increased their purchases of physical gold as they too grapple with a rise in geopolitical instability.
Among central banks, China has been the most aggressive when it comes to buying gold bullion.
Many consumers have turned to purchasing gold bars over the past year, with %Costco Wholesale (NASDAQ: $COST) reporting that it can’t keep gold in stock at its warehouse clubs.
The price of gold has now increased 43% in the past 12 months.
