Gold Resumes Rally After U.S.–China Meeting, Tops $4,000 an Ounce
Gold remains up nearly 50% year to date, supported by steady central bank buying and its role as a hedge against widening fiscal deficits.
Quick overview
- Gold has surged nearly 50% this year, driven by central bank purchases and investor demand for safe-haven assets.
- The metal rebounded 2.1% after losses, buoyed by improved U.S.–China relations following a meeting between Presidents Trump and Xi.
- Federal Reserve Chair Jerome Powell's comments on interest rates contributed to the volatility in gold prices amid ongoing geopolitical risks.
- Despite a recent pullback, gold's bull cycle remains strong due to significant monetary demand and fiscal concerns.
The metal has already surged nearly 50% this year, driven by central bank purchases and investors seeking protection against growing fiscal deficits.
Gold rebounded on Thursday after a string of losses, supported by renewed optimism over U.S.–China relations following the meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping.
The precious metal climbed as much as 2.1% after falling nearly 5% over the previous four sessions, amid volatility fueled by both geopolitical and monetary factors.
Trump described his meeting with Xi as “magnificent,” announcing that Beijing would lift export controls on rare earths and resume purchases of U.S. soybeans. For his part, Xi said China was willing to cooperate with Washington on key areas such as trade, energy, and artificial intelligence, according to state news agency Xinhua.
Beyond Geopolitics
The gold rally also followed comments from Federal Reserve Chair Jerome Powell, who downplayed the likelihood of another rate cut in December.
The Fed reduced its benchmark rate by a quarter percentage point in a split decision that revealed internal divisions over the direction of monetary policy. It was the third consecutive meeting with dissenting votes—a situation not seen since 2019.
This appears to mark an initial attempt to reset the U.S.–China dialogue by reopening selective trade channels to restore confidence. Nevertheless, gold continues to reflect uncertainty, with investors anticipating mild monetary easing from the Fed and lingering geopolitical risk.
The Asset of the Year
Gold had pulled back sharply after hitting a record above $4,380 an ounce last week. Analysts noted that the rally had gone too far, and the recent thaw between Washington and Beijing briefly reduced its appeal as a safe haven.
Even so, gold remains up nearly 50% year to date, supported by steady central bank buying and its role as a hedge against widening fiscal deficits.
While the market has undergone a natural correction, this bull cycle remains unmatched in scale due to the strength of monetary demand.
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