Core Viewpoint - Gold prices are rising due to expectations of looser U.S. monetary policy in the coming year and ongoing geopolitical risks [1][2] Group 1: U.S. Monetary Policy - The rise in gold prices is attributed to expectations of additional interest rate cuts in 2026 following a recent rate reduction by the Federal Reserve [1] - Fed Chair Jerome Powell's less hawkish tone than anticipated has also contributed to the positive sentiment towards gold [1] Group 2: Geopolitical Risks - Ongoing uncertainty regarding peace talks in Eastern Europe is enhancing gold's appeal as a safe haven asset [2] - Tensions in the Middle East and Latin America are further reinforcing the demand for gold amid geopolitical instability [2]

Core Viewpoint - Gold is positioned as the ultimate certainty and a safe haven for investors [1] Group 1 - Gold has historically been perceived as a reliable asset during times of uncertainty [1] - The demand for gold often increases in response to economic instability [1] - Investors consider gold as a hedge against inflation and currency fluctuations [1]

Market Sentiment and Performance - The US Senate's deal to end the government shutdown, the longest in history, positively influenced market sentiment in Australia, with the XJO index rising by 0.60% to 8,824 points [1] - US futures showed an upward trend during the Australian session, with the NASDAQ increasing by 300 points or 1.2%, indicating a potential pause in AI valuation concerns [4][6] Sector Performance - On the ASX, the Information Technology sector led gains on Monday, rising by 2%, followed by energy and materials sectors, while consumer staples and real estate lagged [9][11] - Droneshield faced negative market reaction after retracting a statement about new contracts worth $7 million, while ANZ's earnings were positively received despite a decline in key profit metrics [11] Company-Specific Developments - Downer EDI secured a $750 million contract from Chevron for maintaining non-process infrastructure at Gorgon and Wheatstone in Western Australia [11] - Rare earths stocks experienced a surge, potentially linked to reports suggesting that China's REE deal with the US may not be as trade-friendly as anticipated [12] Commodity and Trade Insights - The price of gold is hovering above US$4,000, indicating ongoing uncertainty in the market and sustained demand for safe-haven assets [14] - China has reportedly suspended export restrictions on antimony and other critical mineral exports to the US, with Larvotto shares rising by 8% amid speculation about the impact of these suspensions [13]

Core Insights - The strong performance of gold is primarily driven by rising investment demand, particularly from institutional buying and gold-backed ETFs, alongside individual purchases of gold bars and coins [1][5] - Central banks continue to support gold demand, accounting for approximately 20% of global demand, although their purchasing rate has slowed compared to record levels in 2022 [2][13] - Jewelry demand has declined in volume due to higher prices, confirming that investment demand is the main driver of the gold market [3] Investment Demand - Investment demand for gold in the Middle East grew by 4% in the first half of 2025, while jewelry demand declined due to elevated gold prices [6] - Gold-backed ETFs experienced a 6.1% increase in total assets during Q3 2025, equivalent to around 222 tons, with a total increase of 20% since the beginning of the year [5] Geopolitical and Economic Factors - Rising geopolitical and economic turbulence, including regional tensions and inflationary pressures, are influencing gold prices, enhancing its appeal as a safe haven [6][7] - The correlation between the Global Geopolitical Risk Index and gold prices indicates that a 100-basis-point rise in the index typically corresponds to a 2.5% increase in gold prices [9] Market Dynamics - Recent sharp increases in gold prices are largely attributed to tactical activities from hedge funds and speculative investors, which may lead to short-term price corrections [10] - The valuation of gold serves as a diversification tool and store of value, showing an inverse relationship with stock markets during downturns [11] Central Bank Trends - Central banks are expected to remain active players in the gold market, with a survey indicating expectations for global gold reserves to continue increasing [13] - The World Gold Council has adjusted its forecast for central bank demand downward due to soaring prices but raised expectations for investment demand [14] Future Outlook - The future direction of US interest rates is crucial for investors, with the Federal Reserve's fiscal policy expected to shape the global trajectory of gold prices [15]

Core Insights - Gold-backed exchange-traded funds (ETFs) are witnessing unprecedented demand, with SPDR Gold Shares ETF recording its second-highest trading volume of $12.5 billion on October 9, indicating a significant surge in investor interest in gold [1][2] - Gold prices have surged nearly 57% over the past year, recently surpassing the $4,000 per ounce threshold and approaching an all-time high of $4,179.71 [2][3] - Central banks are increasingly accumulating gold and silver, with foreign investors now holding more gold than U.S. Treasuries, reflecting a fundamental shift in global safe haven preferences [4][5][6] Trading Volume and Market Dynamics - The trading activity of the SPDR Gold Shares ETF has outpaced that of most major tech stocks, indicating a significant rotation of capital within financial markets [2] - The robust performance of gold and silver is dramatically outperforming traditional equities, with silver prices up 68% in 2025 [3] Institutional and Global Trends - Central banks are actively accumulating silver for the first time in over five decades, with notable purchases such as the Saudi Central Bank acquiring $28.5 million worth in August [4] - The share of U.S. Treasuries held by foreign entities has decreased from 49% in 2013 to 31% today, indicating a re-evaluation of global safe havens [5] Price Action and ETF Performance - As of the publication date, gold prices were $4,108.05 per ounce, having gained 54.89% over the year and 28.02% over the last six months [7] - Various gold ETFs have shown strong year-to-date and one-year performance, with Franklin Responsibly Sourced Gold ETF leading at 55.00% YTD [8]

Meanwhile, the New York Federal Reserve revealing this morning the amount of US treasuries held by global central banks hit its lowest in more than a decade. The drop of about $130 billion just since August, raising fears that global ddollarization is accelerating. For more, let's bring in BK Asset Management, managing director of FX Strategy, Kathy Lean.Kathy, great to have you with us. It's not just this drop held in treasuries held at the New York Federal uh Reserve Bank, but it's also the rise in gold. ...

Group 1 - The current "debasement trade" is driving investment opportunities in both gold and Bitcoin as investors seek refuge from a declining dollar [1][2] - Bitcoin and gold are experiencing new highs, with short-term risks like the government shutdown providing additional support for their safe haven narratives [2][3] - The ongoing US government shutdown has led to a rotation of investments from U.S. treasuries to assets perceived as resilient to political dysfunction and inflation, benefiting Bitcoin [3] Group 2 - Traditional finance is increasingly adopting Bitcoin, although some investors remain cautious due to the unique risks associated with cryptocurrency [4] - ETFs like the Invesco Galaxy Bitcoin ETF (BTCO) offer a convenient and cost-effective way for investors to gain exposure to Bitcoin's price growth [4] - The rise of stablecoin adoption, facilitated by easing regulatory measures, is also benefiting cryptocurrencies like Ethereum, which serves as the backbone for stablecoins [5][6] Group 3 - The next wave of crypto adoption is expected to come from stablecoin adoption, which could positively impact the overall crypto market [6] - The Invesco Galaxy Ethereum ETF (QETH) provides a similar investment pathway for Ethereum as BTCO does for Bitcoin, allowing exposure to Ethereum's growth prospects [6] - Both BTCO and QETH have an expense ratio of 25 basis points, or $25 per every $10,000 invested [7]

Core Insights - Gold futures prices have surpassed $4,000 per ounce for the first time, driven by investor demand for safe havens amid economic uncertainty and a government shutdown [1][4] - The price of New York spot gold has increased to $3,960.60 per troy ounce, reflecting a broader trend of rising gold prices [1] Market Dynamics - Sales of gold typically surge when investors seek secure investments during turbulent times, with gold and other metals like silver experiencing significant gains over the past year due to global economic disruptions [2] - The ongoing government shutdown has contributed to safe-haven flows into gold, with no immediate resolution in sight [3][5] Performance Metrics - Gold has risen by 52% this year, influenced by expectations of interest rate cuts, political and economic uncertainty, strong central bank purchases, inflows into gold-based funds, and a weak dollar [4] - The US government shutdown has delayed the release of key economic indicators, leading investors to rely on secondary data for insights into Federal Reserve rate cuts [5]

Market Trends - Bitcoin price increased immediately after the government shutdown [1] - Bitcoin is considered a safe haven from sovereign uncertainty due to its decentralized and apolitical nature [1]

Group 1 - Hut 8's revenue is significantly influenced by Bitcoin mining, and the recent rise in Bitcoin's value has positively impacted the company's stock price, which increased by almost 18% [1] - A bullish market for Bitcoin typically leads to optimism for miners, with Bitcoin's value rising nearly 13% since last Friday, partly due to its perception as a safe haven during the federal government shutdown [2] - Canaan announced a substantial order for over 50,000 crypto mining rigs, indicating strong client confidence in Bitcoin's future, marking the largest order in over three years for the company [3] Group 2 - The Avalon A15 mining rig is primarily designed for Bitcoin mining, and the recent price surge of Bitcoin makes it less appealing for clients to mine other cryptocurrencies [4] - The performance of miners like Hut 8 is closely tied to Bitcoin's market trends, and the recent bullish sentiment has been beneficial for the company [6]