Gold set for best week in 17 years

Gold notched a new high above $4,300 an ounce on Friday and was poised for its best week in over 17 years, as signs of weakness in US regional banks, global trade frictions, and firming rate-cut bets drove investors to the safe-haven metal.

Spot gold rose 0.8% to $4,359.31 per ounce, as of 0615 GMT, after scaling another record high of $4,378.69 earlier. US gold futures for December delivery jumped 1.6% to $4,372.10.

Bullion has risen about 8.6% this week and is headed for its best week since September 2008, notching a record high in each session.

Spot silver rose 0.1% to $54.26 per ounce, set for an 8% weekly gain. Earlier in the session, prices reached a record high of $54.35, tracking the rally in gold and a short squeeze in the spot market.

“(For gold) $4,500 could arrive as a sooner-than-expected target, but much may depend upon how long concerns about U.S.-China trade and the government shutdown linger over the market for,” said KCM Trade Chief Market Analyst Tim Waterer.

China levelled fresh accusations against the US of causing panic over its rare earth controls, while rejecting calls to reverse export curbs.

HSBC on Friday raised its 2025 average gold price forecast by $100 to $3,455 per ounce, citing geopolitical tensions, economic uncertainty, and a weakening US dollar, and projected prices could reach $5,000 in 2026. “Gold rally likely sustained through 1H’26 by geopolitical risks, economic policy uncertainty and rising public debt,” the bank said in a note. Unlike past rallies, HSBC believes many of the new entrants to the gold market are likely to remain even after the rally subsides - not necessarily for price gains, but for gold’s role as a diversifier and safe-haven asset. While the US Federal Reserve’s rate-cutting cycle is expected to support gold prices, its positive impact tends to fade as the cycle wanes, the bank noted. Gold prices scaled another record high at $4,378.69 on Friday and was headed for its biggest weekly gain since December 2008, as geopolitical and economic uncertainty along with growing US rate cut bets drove investors to the safe-haven metal.

Reuters