Gold Edges Higher Amid U.S. Weakness, Haven Demand Rises

Global gold prices climbed on Friday, underpinned by signs of a weakening U.S. economy and the resurgence of safe-haven demand.

Bullion traded around US$ 4,017 per ounce, after finishing the previous week little changed.
The move comes as the U.S. consumer sentiment index plunged towards record lows, driven by a prolonged government shutdown and rising inflation.

Though a deal to reopen the U.S. government appears to be nearing completion — moderate Senate Democrats were reported to support an agreement — market concerns over the economic outlook have remained elevated.

Gold’s rally earlier this year has been remarkable: from mid-October it has retreated about 8 % from its all-time high above US$ 4,380/oz, but remains up by more than 50 % for the year.
Key drivers behind the strength include heightened economic and geopolitical uncertainty, strong central-bank buying and elevated retail demand.

As of 8:30 a.m. Singapore time on Friday, spot gold rose 0.4 % to US$ 4,016.92/oz. The Bloomberg Dollar Spot Index added 0.1 %, while silver, platinum and palladium also advanced.

Why It Matters

Safe-haven appeal: With economic growth in the U.S. showing signs of stress and the government shutdown dragging on, investors are gravitating toward gold as a hedge.
Currency and inflation interplay: A modest rise in the U.S. dollar dampens some of gold’s upside, but inflation and uncertainty still boost demand.
Year-to-date context: Even after the pullback from record highs, gold remains significantly higher this year, suggesting persistent bullish undercurrents.

What to Watch

The outcome of the U.S. government shutdown and any further indicators of consumer or business sentiment in the U.S.—these will influence gold’s near-term trajectory.
Moves in the U.S. dollar and real interest rates. A stronger dollar or higher yields could dampen gold demand, while the reverse may amplify it.
Central-bank buying trends and retail demand patterns, which have been major supports for gold’s rally.

The Bottom Line

Gold’s upward creep reflects broader unease in global financial markets: with the U.S. economy showing signs of stress, investors are re-embracing gold’s role as a haven asset. While the metal has pulled back from record highs, the prevailing uncertainty suggests it may still have room to manoeuvre.