Street Calls of the Week
Gold’s relentless climb to new record highs has reignited debate over whether the rally can continue. Yet, despite the historic levels, Swissquote Bank remains positive on the metal’s outlook. The bank views gold’s strength not as a speculative excess but as a reflection of deeper structural forces reshaping global markets.
A Market of Belief, Not Balance Sheets
Gold has no earnings or valuation models to determine its fair price. Its worth depends on collective belief and its enduring role as a store of value. In a world where digital tokens trade above 120,000 dollars, investors see gold’s tangible, time-tested stability as undervalued. If purely digital assets can reach such valuations, gold’s long-term potential remains significant.
The rally extends beyond short-term speculation. It reflects concerns about rising government debt, the weakening credibility of fiat currencies, and a global shift toward fiscal dominance. As monetary policy becomes increasingly aligned with fiscal priorities, the appeal of gold as a physical, independent asset continues to grow.
The Psychology Behind the Price
Gold’s movement is driven as much by sentiment as by fundamentals. Each central bank purchase, geopolitical tension, or sign of monetary accommodation strengthens its reputation as the ultimate hedge. The surge has created a feedback effect in which higher prices attract more demand, sustaining the rally’s momentum.
Institutional investors are also increasing allocations through bullion and ETFs, transforming gold from a defensive instrument into a strategic core holding in diversified portfolios.
Outlook: The Road to 5,000 and Beyond
Swissquote Bank maintains that the medium-term outlook for gold remains constructive even at record levels. With abundant global liquidity and persistent inflation expectations, the macro environment continues to favor precious metals. A move toward 5,000 dollars per ounce is becoming increasingly plausible under these conditions.
If confidence in paper assets keeps eroding, gold’s role will evolve from a portfolio hedge to a foundation of long-term capital preservation. In a financial world defined by debt and uncertainty, the belief in gold’s enduring value may once again prove justified.