Gold tops $4,400 for first time in history: Here's why

The price of gold rose to a historic high on Monday, December, 22, reaching above $4,400 per ounce for the first time as expectations for U.S. interest rate cuts and persistent geopolitical tensions fuelled a powerful rally in safe-haven assets.

Spot gold increased to $4,420 per ounce before easing slightly while analysts predicting that future rate will touch $4,442.

This marks a 68% increase in the precious metal this year, recording its strongest annual performance since 1979.

Experts attribute this rally to a number of factors including softer U.S. inflation. Additionally, jobs data have solidified market bets on Federal Reserve rate cuts in 2026, minimizing the opportunity cost of holding non-yielding bullion.

At the same time, geo-political frictions also contribute to the increasing gold prices including U.S. tensions with Venezuela that has spurred demand for traditional shelters.

Furthermore, underpinning the rally is sustained buying by central banks globally, seeking to diversify reserves away from the U.S. dollar amid economic uncertainty.

With this rally, the entire sector of precious metals has been lifted.

Silver hit a record near $69.44 an ounce, up 138% year-to-date, while platinum trades at a 17-year-high.