The price of gold has hit a record high of more than $4,000 (£2,985) an ounce as investors look for safe places to put their money over concerns about economic and political uncertainty around the world.
Gold has seen its biggest rally since the 1970s, rising by around a third since April when U.S. President Donald Trump announced tariffs which have upset global trade.
Analysts say another issue worrying investors is delays to the release of key economic data due to the U.S. government shutdown, as it enters its second week.
Gold is seen as a so-called safe haven investment, which is expected to retain or increase its value during times of market turbulence or economic downturns.
The price of spot gold - the real-time market value of the precious metal for immediate delivery - rose to more than $4,036 an ounce on Wednesday afternoon in Asia.
Gold futures - which serve as a gauge of market sentiment - reached the same level on October 7. Futures are agreements to buy or sell the asset at a pre-determined date in the future.
The US government shutdown, initiated by repeated impasses over public spending, is a tailwind for gold prices, said OCBC's Christopher Wong, Singapore-based bank's rates strategist.
Investors have turned to safe haven assets like gold during previous U.S. government shutdowns.
It rose by nearly 4% during the month-long shutdown in Trump’s first term in the White House.
But gold prices could fall if the shutdown ends more quickly than some investors are expecting, said Mr. Wong.
Gold's unprecedented rally in the past month has surpassed analysts' expectations, said UOB bank's head of market strategy Heng Koon How.
The rise is also tied to the weakening U.S. dollar and more non-professional buyers, known as retail investors, purchasing gold.
A record $64 billion has been invested in gold ETFs so far this year, according to the World Gold Council trade association.
Gregor Gregerson, the founder of precious metals dealer Silver Bullion, stated that customer numbers have more than doubled in the past year, with retail investors, banks, and wealthy families increasingly viewing gold as a safeguard against global economic uncertainty.
Most of our clients are long-term holders, Mr. Gregersen explained, noting that many customers store their gold for over four years. He believes gold is on an upward trend for at least five years due to the current economic environment.
Gold prices may dip if interest rates rise or geopolitical tensions ease, similar to the previous occurrences where gold’s value fluctuated in line with market conditions.
The climb in gold prices reflects expectations that the Fed will lower interest rates, making gold more attractive amid criticisms from Trump regarding the Fed's rate policies.
Mr. Wong emphasized that in the current economic climate, gold’s role as a hedge against uncertainty gains renewed importance.
