The logic of gold trading is changing: the safe-haven attribute is returning, and the misjudged market correction will eventually be repaired

Starting today, the core trading logic of gold has undergone a transformation, with its inherent safe-haven properties receiving unprecedented market attention and re-pricing. Looking back at yesterday’s market movements, the panic index soared sharply, international oil prices surged strongly, yet gold did not continue the previous trend of falling alongside market volatility. This independent resilience is exactly what gold, as a safe-haven asset, should demonstrate.

All along, I have firmly believed that the core value of gold lies in its safe-haven attribute, not merely being priced based on inflation and rate hike expectations. The recent sharp rise in oil prices essentially triggers cost-push inflation, characterized by rising prices alongside economic weakness. If rate hikes are suddenly implemented at this point, it would only further suppress economic vitality and could even directly trigger a recession; addressing supply-side issues fundamentally is the best solution to such inflation. Therefore, the current market fundamentally lacks the realistic basis for rate hikes.

Some argue that after the 1970s oil crisis triggered inflation, the Federal Reserve responded with aggressive rate hikes. However, a deeper understanding of the economic context at that time reveals that those rate hikes were a response to complex inflation, not a passive reaction solely to rising oil prices. Moreover, today’s global economic environment and debt levels are vastly different from those days: in the 1970s, U.S. debt was only about $380 billion, whereas now it has soared to $39 trillion, a hundredfold increase. Under such enormous debt pressure, reckless rate hikes would directly impact the fiscal system and could even trigger a fiscal crisis. Such rate hike measures are simply not feasible.

As market participants gradually recognize the core reality of “no rate hikes,” everyone will realize that the current decline in gold is not due to weakening fundamentals but is a typical misjudged market correction, driven by deliberately manufactured panic emotions interfering with pricing. Once market panic subsides and rationality returns, gold’s safe-haven value will be fully highlighted, and the misjudged valuation will ultimately be restored.