Oil Prices Also on the Rise
As geopolitical tensions have escalated due to the U.S. blockade of Venezuela, and expectations for interest rate cuts by the Federal Reserve next year have risen, the prices of gold and silver-considered representative safe-haven assets-have once again reached all-time highs.
According to Bloomberg on December 22, as of 2:40 p.m. (Korea Standard Time) that day, the international spot price of gold stood at $4,404.51 per ounce, surpassing the previous all-time high of $4,381 set in October. The spot price of silver also reached a new record at $69.4549 per ounce as of 1:14 p.m. (Korea Standard Time) before slightly retreating to $68.8837 by 2:40 p.m.
Bloomberg reported, "The United States is tightening its oil blockade against Venezuela, and Ukraine has attacked a Russian oil tanker in the Mediterranean for the first time, leading to heightened geopolitical tensions. As a result, the safe-haven appeal of gold and silver is increasing." It added, "Gold and silver are expected to post their strongest annual gains since 1979. In particular, gold prices have soared by about 66% this year, driven by increased purchases from central banks and capital inflows into gold spot-based exchange-traded funds (ETFs)."
On December 16, U.S. President Donald Trump announced that the Maduro regime in Venezuela had been designated as a foreign terrorist organization and that all sanctioned oil tankers traveling to and from Venezuela would be completely blocked, raising concerns about the expansion of the conflict.
The recent upward trend in gold prices also appears to have been influenced by expectations of a Federal Reserve rate cut next year. On the same day, Reuters analyzed that gold, traditionally considered a safe-haven asset, is being supported by heightened geopolitical and trade tensions, steady central bank purchases, and expectations for rate cuts next year.
Matt Simpson, senior analyst at StoneX, noted, "December is typically a favorable period for gold and silver returns due to seasonality." He added, "Gold prices have already risen by 4% this month, and as the end of the year approaches, trading volumes may decline." He further cautioned, "Bulls should be mindful of the increasing likelihood of profit-taking and exercise caution."
He also mentioned that the market is widely anticipating two rate cuts by the Federal Reserve in 2026, and if the slowdown in U.S. employment progresses faster than expected and the Fed shifts to a more dovish (accommodative) stance, there could be further upside potential for gold prices.
Wang Tao, technical analyst at Reuters, projected that since the spot price of gold has broken through the key resistance level of $4,375 per ounce, it could rise further to $4,427.
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