Gold prices climbed on Wednesday as investors moved toward safe-haven assets amid a global stock market selloff, rising fiscal concerns in major economies, and uncertainty over upcoming U.S. Federal Reserve decisions.

At 07:55 ET (12:55 GMT), spot gold gained 1.2% to $4,116.33 per ounce, while December gold futures rose 1.2% to $4,116.64/oz.

Fiscal Concerns in Japan Trigger Safe-Haven Buying

A sharp rise in Japanese government bond yields triggered fresh anxiety in global markets. Longer-term Japanese bonds saw yields surge to multi-decade highs, while the 10-year yield hit its highest level since the 2008 financial crisis.

The jump followed reports that the Sanae Takaichi administration is preparing a massive ¥25 trillion ($163 billion) stimulus package, far larger than earlier expectations. The scale of the spending deepened worries about Japan’s stretched fiscal position and its ability to manage further debt.

Japan’s significance as a major global creditor added to market jitters, with analysts warning that instability in its bond market could spill into international financial systems.

Geopolitical Tensions Add to Market Pressure

Gold also gained support from geopolitical concerns. A diplomatic dispute between Japan and China escalated this week after comments made by Prime Minister Takaichi on Taiwan. Tensions grew despite Tokyo’s attempts to ease the situation, adding another layer of uncertainty for investors.

Global Selloff and Tech Valuation Fears Push Investors to Gold

Global stock markets fell sharply as investors reassessed overheated technology valuations. Sentiment remained cautious ahead of earnings from NVIDIA (NASDAQ: NVDA), a major player in the AI sector whose performance often sets the tone for tech stocks.

This shift away from equities sent more traders toward gold, traditionally viewed as a safe store of value during market turbulence.

U.S. Fed Minutes and Rate Outlook Drive Additional Gains

Uncertainty around the Federal Reserve’s next move also boosted gold. Recent U.S. jobless claims data pointed to continued labor-market weakness, prompting traders to raise expectations for a potential December rate cut.

However, sentiment remains mixed.
According to CME FedWatch, markets now price in a 42.4% chance of a 25 bps cut at the December 10–11 meeting—down from 62.4% last week.

Investors are watching closely for the release of the Fed’s late-October meeting minutes. While the Fed voted almost unanimously for a 25 bps cut at that meeting, members appear divided over whether another cut is appropriate in December. A prolonged U.S. government shutdown has left the Fed with limited official data, increasing the likelihood of a more cautious approach.

Stable interest rates typically reduce the appeal of non-yielding assets like gold, but ongoing uncertainty has kept demand strong.

Analysts Say Gold’s Rally Has Strong Foundations

Max Baecker, President of American Hartford Gold, said the metal’s performance is backed by fundamental trends.

“Elevated inflation, growing sovereign debt, persistent deficits, and global uncertainty all strengthen gold’s appeal as a safe haven and an inflation hedge,” he told Investing.com.

Baecker added that central bank buying and strong technical momentum are helping sustain the rally.

Other Precious Metals Surge

Precious metals rallied alongside gold:

• Spot platinum rose 2.1% to $1,588.35/oz
• Spot silver jumped 3.2% to $52.123/oz