Gold has witnessed a historic rally, reaching the threshold of $3,600 per ounce for the first time ever—a moment experts describe as a fundamental turning point in the trajectory of the precious metals market.

This record-breaking surge was not random. It was driven by weak U.S. economic indicators, mounting pressure on Federal Reserve policies, escalating geopolitical tensions, and notable moves in central bank reserves, investment funds, and gold futures contracts.

In this comprehensive article from Gold.sa, we dive into the reasons behind the global rise in gold prices that reshaped the market landscape and made gold the headline asset of 2025.

Why Did Gold Prices Skyrocket in Early September 2025?

Gold recorded a sharp rise, hitting $3,600 per ounce on September 8, 2025, due to several overlapping factors: weak U.S. labor market data, expectations of interest rate cuts, a declining dollar, global geopolitical tensions, removal of tariffs on gold, and reduced liquidity in U.S. markets.

This surge impacted Gulf markets as well. On September 8, 2025, 24K gold price per gram reached 436.86 SAR, while 21K gold per gram climbed to 381.34 SAR, according to Gold.sa price bulletins—raising both buying and selling costs in Saudi Arabia.

Key Drivers of Gold’s Unprecedented Rally:

1- U.S. Interest Rate Cut Expectations Push Gold Higher

Gold surged over the past four months, supported by expectations that the Federal Reserve would cut rates in September, with further reductions possible before year-end.

U.S. jobs data confirmed this trend: only 22,000 jobs added vs. 75,000 expected, while unemployment rose to 4.3%. This weakness strengthened market conviction of three potential rate cuts of 0.25 basis points each, weakening the dollar and boosting gold’s appeal as a safe-haven asset.

2- Dollar Weakness Exposes Fragile Monetary Policy

The U.S. Dollar Index fell to a five-week low, while Treasury yields declined, increasing demand for dollar-priced gold. Political pressure on the Fed raised doubts about central bank independence, further driving investors toward gold as a hedge against dollar weakness.

3- Institutional Demand via In