Core Viewpoint - The article emphasizes a strategic bullish outlook on gold, driven by a restructured global financial and political order, rather than traditional macroeconomic factors [4][9]. Research Context - The company initiated a strategic bullish view on gold at the beginning of 2023, with a report titled "Gold: A Century, A Decade, Next Year" released in December 2022 [5]. - Subsequent reports in May 2024, March 2025, and May 2025 further explored gold pricing logic and the dynamics driving gold price increases [5]. Latest Research Findings - The latest research focuses on what gold is pricing, introducing the "Implied Order Reconstruction Index" to address the limitations of traditional factors like real interest rates, inflation expectations, and the US dollar index in explaining gold's price surge [6]. - The "unconventional momentum" identified in the index reflects investor expectations regarding the restructuring of the global financial and political order, which has been the primary driver of gold prices since 2023 [7]. Future Outlook - The "Implied Order Reconstruction Index" remains the core driver of recent gold price increases, challenging the notion that traditional factors like central bank gold purchases or Federal Reserve rate cuts are responsible for the price rise [9]. - Recent geopolitical and economic instability, such as unrest in Indonesia and political turmoil in Nepal and Argentina, has contributed to fluctuations in the index, reinforcing the view that the core force driving gold prices is the expectation of order reconstruction [9]. - The index has approached and surpassed historical highs last seen in 1980, indicating potential for further price increases if it stabilizes above this level [9]. Asset Allocation Perspective - Gold's allocation value is significant, as even a 5% allocation can optimize the risk-return profile of a diversified asset portfolio [10]. - Gold is uniquely positioned to have low correlation with both US-dominated financial assets and commodities driven by Chinese demand, enhancing its appeal as a strategic asset [10]. - The company maintains a bullish stance on gold, asserting that the recent price breakthrough of $4,000 per ounce does not signify the end of the upward trend [10].

Group 1: Gold Market Insights - The Gold Implied Order Reconstruction Index (GIORI) has reached its highest level since the 1970s, indicating strong market expectations for a global order reconstruction[2] - The surge in gold prices cannot be fully explained by traditional factors such as real interest rates, inflation expectations, and the US dollar index, suggesting a shift in investor sentiment towards geopolitical risks and financial system pressures[2][14] - Central banks have significantly increased gold purchases, with the scale reaching a 50-year high from 2022 to 2024, reflecting a global trend towards diversifying monetary systems[15] Group 2: US Economic Conditions - The US dollar index has declined significantly, dropping to 99.2, its lowest level in nearly three years, with an 8.5% decrease since the beginning of the year[19] - The "Big and Beautiful" bill passed by the US House of Representatives is expected to exacerbate the debt-inflation cycle, potentially weakening dollar assets in the medium to long term[19][18] - The US debt-to-GDP ratio is projected to soar to between 134% and 149% by 2035 due to the largest debt ceiling increase in history, amounting to $4 trillion[19] Group 3: Chinese Economic Strategy - China has adopted a dual expansionary policy approach, focusing on both fiscal and monetary measures to stabilize the economy, contrasting with the US's policy challenges[20] - The Chinese stock market is expected to outperform the bond market during the current interest rate reduction cycle, driven by monetary easing and economic recovery[20] - China's asset prices are anticipated to stabilize and gain upward momentum as the economy gradually recovers and inflation returns[20] Group 4: Market Strategies - The recommended investment strategy is a "barbell" approach, combining dividend stocks and small-cap growth stocks, as inflation has not yet returned[22][23] - The bond market is expected to experience volatility, with the 10-year government bond yield projected to fluctuate between 1.6% and 1.7%[29]

Core Viewpoints - The article emphasizes a long-term bullish outlook on gold, suggesting that the current era resembles a once-in-a-century global order restructuring period [2][9] - It highlights the limitations of traditional gold pricing models, which have failed to adequately explain recent price movements [4][12] - The article introduces the Gold Implied Order Reconstruction Index (GIORI) to quantify market expectations regarding the restructuring of global financial and political orders [6][10] Group 1: Traditional Gold Pricing Models - Traditional financial theories assert that gold prices are primarily driven by real interest rates, the US dollar index, and inflation expectations [4][12] - The relationship between real interest rates and gold prices has significantly weakened since 2022, with real rates rising from -1% to 2% while gold prices increased from $1,800 to over $3,000 [13][19] - The US dollar index has shown limited explanatory power for gold price movements, as it fluctuated within a narrow range while gold prices surged over 80% [16][19] Group 2: Drivers of Global Order Restructuring - The remarkable increase in gold prices reflects market expectations of a global order restructuring, characterized by currency diversification, geopolitical reshaping, and financial market rebalancing [5][22] - Central bank gold purchases reached a 50-year high from 2022 to 2024, with net purchases of 1,080 tons in 2022, 1,051 tons in 2023, and 1,045 tons in 2024 [23] - Geopolitical risks, particularly the Russia-Ukraine conflict and tensions in the Middle East, have heightened demand for gold as a safe-haven asset [26][28] Group 3: Gold Implied Order Reconstruction Index (GIORI) - The GIORI aims to quantify the unexplained volatility in gold prices, reflecting market expectations of non-traditional risks associated with global order restructuring [6][31] - The GIORI index has reached its highest level since the 1970s, indicating that market expectations have surpassed traditional cyclical perspectives [7][42] - Historical peaks of the GIORI index occurred during significant geopolitical events, such as the Iranian Revolution and the 2008 financial crisis, highlighting its relevance in assessing market sentiment [46][47][48]