Gold Continues to Hit New Highs: It's No

Gold Continues to Hit New Highs: It's Not Just "Consensus", But the Logic of Hard Currency That Transcends Cycles

 

When the price of gold repeatedly breaks historical highs in the capital market, more and more people attribute this to "market consensus" — as if gold can gain significant pricing power as long as enough investors believe it will rise. However, a deeper look into the logic behind gold's rally reveals that what supports it to navigate bull and bear markets and hit new highs repeatedly is never a single "consensus bubble", but multiple certainties rooted in its own attributes and combined with the global macro environment.

 

Consensus is indeed a "booster" for gold's rise, but by no means its "underlying logic". Essentially, the consensus around gold does not emerge out of thin air; it stems from humanity's recognition of its value over thousands of years — from being a currency reserve in ancient times to a safe-haven asset in modern days. Gold's characteristics of "anti-inflation, high liquidity, and no reliance on any credit backing" have long been engraved in global financial awareness. This consensus is not a herd mentality formed by short-term speculation, but a "collective rational choice" verified by numerous economic crises and currency turbulences: when the 2008 financial crisis swept the globe, when the 2020 pandemic hit the market, and when central banks around the world launched easing policies to dilute the value of fiat currencies, capital always flocked to gold, the "last safe haven". It can be said that the consensus on gold is a "result", not a "cause"; it is gold's hard currency attribute that has led the market to form the tacit understanding of "allocating to gold whenever risks arise".

 

What enables gold to keep hitting new highs beyond consensus lies in its precise alignment with the current "pain points" of the global economy. On one hand, global inflationary pressures have not yet fully subsided, and the uncertainty about the purchasing power of fiat currencies has once again highlighted gold's "anti-inflation" attribute. When prices rise and paper money depreciates, gold, as a physical asset, does not see its intrinsic value diluted by the increase in money supply — this is a key advantage that distinguishes it from credit assets such as stocks and bonds. On the other hand, risk factors such as geopolitical conflicts and slowing global economic growth have pushed the market's demand for "certainty" to a new high. According to data from the World Gold Council, central banks worldwide have continued to increase their gold holdings in recent years; in 2023, the net increase in global central bank gold reserves exceeded 1,000 tons, a record high. The gold-purchasing behavior of central banks is essentially using "national credit" to endorse gold's value, further strengthening the market's long-term confidence in gold.

 

What is even more noteworthy is that gold's "significance" lies in the fact that it is one of the few assets in the global financial system that is "not tied to any single economy". Stocks depend on corporate profits, bonds rely on government or corporate credit, and exchange rates are affected by the economic policies of two countries. In contrast, the value of gold is not attached to any country or institution. This "independence" endows it with special significance amid changes in the global economic pattern: when the U.S. dollar strengthens, gold may come under short-term pressure, but in the long run, as long as global concerns about the "stability of credit currencies" persist, gold will have room to rise. When emerging economies seek currency diversification, gold also becomes an important allocation in various countries' foreign exchange reserves to balance risks. This "irreplaceability" makes gold's influence go beyond being a mere "investment product" and turns it into one of the "ballasts" for global financial stability.

 

Returning to the original question: Is gold's continuous new highs driven by consensus? It might be said that consensus is an "amplifier" of gold's value, but what truly gives it a pivotal role is its hard currency attribute that transcends cycles, the global macro environment's urgent demand for "safe assets", and its unique and irreplaceable position in the credit currency system. In the future, as long as factors such as inflation, geopolitical risks, and global economic uncertainty remain, the "consensus" on gold will not easily collapse, and its value as a "hard currency" will continue to write new heights in the capital market.