Gold and silver futures' record-high run…"Upward trend until year-end"

Market bets on US rate cuts

Gold and silver ETFs up around 5% in one week

Dollar weakness and US Treasury yields decline

Scarcity value fuels gold's rise

"$4,000 per troy ounce possible"

Gold and silver futures prices are rising. Views that the US central bank (Fed) will cut rates imminently have increased expectations for precious metals' value. Interest rate cuts generally reduce the value of currency and cause prices of scarce-value goods to rise. Global economic slowdown and uncertainty over US tariff policy are also cited as factors brightening the outlook for safe-haven assets.

◇Gold mining ETFs also see sharp gains

According to the Korea Exchange on the 2nd, exchange-traded funds (ETFs) investing in gold and silver rose around 5% over the past week (August 26–September 1). The leverage product tracking gold futures, 'ACE Gold Futures Leverage (Synthetic H)', jumped 7.66% during this period. It was the seventh-highest return among some 1,000 ETFs listed on the domestic stock market.

'KODEX Silver Futures (H)' gained 5.93% over the same period. 'TIGER Gold and Silver Futures (H)', 'KODEX Gold Futures (H)', and 'TIGER Gold Futures (H)' also posted returns around 4%.

Gold and silver futures prices continue their record-high run. On the New York Mercantile Exchange, the December-delivery gold futures price rose intraday on the 1st (local time) to a record high of 3578.2 dollars per troy ounce. Gold prices have surged 42% over the past year. This outpaced the Nasdaq 100's rise (19.62%) over the same period by more than double.

Silver futures are also trading well above 40 dollars per troy ounce. Based on December delivery, they recorded an intraday 41.9 dollars, approaching 42 dollars. It is the first time since 2011 — 14 years — that silver futures have surpassed 40 dollars per troy ounce.

As gold prices rose, ETFs that invest in gold mining companies also strengthened. A representative example is 'HANARO Global Gold Mining Companies', which rose 5.09% over the past week. It is a product that invests in the stocks of North American and Australian gold mining companies such as Newmont, Agnico Eagle Mines, and Barrick Mining.

◇Gold futures 4,000 dollars outlook

Experts analyzed that expectations of an imminent cut in the US policy rate pushed up gold prices. Observations that the Federal Open Market Committee (FOMC) meeting on the 16th–17th of this month will lower the policy rate by 0.25% point have gained traction. Fed Chair Jerome Powell said in his Jackson Hole speech last month that "monetary policy could be eased." A recent personal consumption expenditures (PCE) inflation indicator that came out in line with market expectations also strengthened expectations of a rate cut.

Global market instability has also been a factor driving up gold, a safe-haven asset. Recently, US President Donald Trump dismissed Fed Governor Lisa Cook, raising concerns about the Fed's independence and increasing instability in the US financial system. A US federal appeals court ruling suggesting that President Trump's reciprocal tariffs could be an abuse of authority has made it difficult to predict the direction of global financial markets.

Securities firms expect gold and silver prices to trend upward until year-end. Seonghyun Hwang of Eugene Investment & Securities explained, "Preference for safe-haven assets has increased due to political conflicts in the US over the policy rate, and dollar weakness and declining US Treasury yields have also promoted rising gold prices," adding, "Silver will also maintain high prices due to supply constraints."

There are also forecasts that gold prices could approach 4,000 dollars per troy ounce. Rosenberg Research predicted, "If the Fed ultimately lowers the policy rate to 3% and the dollar's value remains at an appropriate level, gold prices could rise to 3800 dollars per troy ounce." It added, "If market uncertainty persists and global central banks continue buying gold, 4000 dollars is also possible."

Yang Ji-yoon Reporter yang@hankyung.com