Gold breaks through $4,500! The central bank's "de-dollarization" strategy is a driving force, and experts indicate there will still be support next year.

The global precious metals market is experiencing a once-in-a-decade rally. London spot gold has risen to $4,525.7 per ounce, hitting a record high, with an increase of over 172% so far this year; silver has also surged to $72.68, with an annual gain of 155%; copper prices have reached $12,282, nearly a 40% increase year-to-date. Behind this rally, it is no longer just traditional safe-haven buying but a multi-layered push driven by the strategic shift of global central banks, green energy, and the AI wave.

Central Bank “De-dollarization” and Real Rate Restructuring — The Deep Logic Behind the Precious Metals Rally

From the central bank perspective, gold is becoming the preferred asset for diversifying foreign exchange reserves. Standard Chartered Bank pointed out that, when measured by real prices, gold has hit a historic high, but relative to the valuation of the US stock S&P 500 index, it remains at multi-decade lows, leaving room for further upside. Additionally, major central banks continue to seek assets outside of the US dollar, creating significant demand.

Market signals are also changing: major foreign banks indicate that the inverse correlation between gold and bond yields is re-establishing. This suggests that once the market confirms interest rates will decline or real yields are under pressure, gold’s rise will no longer rely solely on short-term sentiment but will be supported by more solid fundamentals.

Silver serves both investment and industrial needs. Besides following gold’s safe-haven and asset allocation trends, high-end audio cables, passive components, solar cells, and other advanced components heavily rely on silver’s conductive properties, with demand continuously expanding, gradually pushing up costs along the supply chain.

Copper prices are directly linked to global energy transition and technological upgrades. AI data centers have become major consumers of copper; a single large AI data center uses 3 to 4 times more copper than traditional data centers. In infrastructure competition, copper has become a strategic raw material.

Price Target of $5,000–$5,100 Next Year — Most Foreign Banks Are Bullish

Several international banks have issued clear forecasts. DBS Bank pointed out that reaching $5,000 in gold prices by 2026 is a basic expectation, with some institutions even looking higher. The bank believes that the three main catalysts driving gold in 2025 will continue into 2026:

• Concerns over US fiscal sustainability and debt
• High geopolitical and policy uncertainty
• Continued depreciation expectations of the US dollar

Supported by global central bank gold purchases and ETF capital inflows, the forecast for gold prices in the second half of 2026 can reach $5,100.

HSBC highlighted another key variable: Federal Reserve Chair Powell’s term ends in May 2025, and the policy stance of his successor could influence the dollar’s trend. If the new chair does not shift to a hawkish stance, the dollar may remain under pressure, further boosting gold.

Chain Reactions in Taiwan’s Investment and Industry Sectors

The warming of the precious metals market has broad impacts locally:

Asset Allocation: In an environment of volatile stocks and bonds, gold and silver’s value as risk diversification tools is once again highlighted, becoming essential additions to investment portfolios.

Manufacturing Cost Pressures: Continuous rises in silver and copper prices will gradually increase production costs for electronic components, transmission lines, and green energy equipment, testing the profit margins and pricing power of related manufacturers.

Returns on USD Assets: If the US dollar weakens long-term, returns on dollar-denominated assets may be eroded, increasing the attractiveness of non-dollar assets like gold.

Conclusion: From Cyclical Commodities to Strategic Assets

This metals rally has evolved from a short-term “cyclical rise” into a long-term “structural bull market.” Gold has transcended its traditional roles of hedging inflation and interest rates, becoming a practical part of the global central banks’ “de-dollarization” strategies; silver and copper are directly benefiting from the tangible demands of energy transition and AI infrastructure. For investors, rather than obsessing over whether prices are overvalued, it is more important to understand the long-term momentum behind these trends — gold is reshaping its position within the global economy.