Spot gold hit a new record high of $2,989 on Thursday, just a stone’s throw away from the $3,000 mark. Meanwhile, Comex gold futures on the New York Mercantile Exchange have already hit $3,000.

Current Comex gold inventories have exceeded 40 million ounces or 1,250 tons, an increase of more than 23 million ounces since the U.S. election in November last year, reflecting unprecedented demand for physical gold delivery.

Comex gold inventory Source: Macromicro

During the same period, London gold stocks fell for three consecutive months. Not only in London, but gold from all over the world is being shipped to the United States at an accelerated pace. Data shows that the United States imported $30 billion worth of gold in January, about twice as much as during the epidemic.

Among them, Switzerland’s gold exports to the United States in January hit a 13-year high of 192.9 tons. Due to the different delivery specifications of gold bars in New York and London, London gold needs to be shipped to a Swiss refinery for recasting before being shipped to New York. The record gold transactions between the two countries caused the US trade deficit with Switzerland to surge to about $22 billion in January, close to China.

Total US imports from Switzerland (blue line) and deficit (red line) Source: Financial Times

The “great shift” of physical gold highlights the strong risk aversion in the market. Trump’s ever-changing tariff policy may cause inflation risks or even economic recession; the sharp drop in US technology stocks may trigger a sharp correction in US stocks; the expectation of a Fed rate cut is rising; geopolitical conflicts have been delayed; the disorderly expansion of US debt and the unsustainability of annual interest payments of nearly $1 trillion; the excessive issuance of US dollars has led to credit damage and accelerated global de-dollarization, which are all catalysts for gold price increases.

Data from the World Gold Council shows that global gold demand will reach a record high of 4,974 tons in 2024, of which global central banks’ gold purchases have exceeded 1,000 tons for three consecutive years and increased by 54% year-on-year in the fourth quarter, contributing more than 70% of the increase in gold demand in 2024. Under the huge uncertainty of Trump 2.0, the demand for gold by global central banks (especially emerging market central banks) is expected to remain high.

Global central banks’ net gold purchases have exceeded 1,000 tons for three consecutive years. Source: World Gold Council

As gold prices continue to hit new highs, in addition to central banks and large traders, individual investors have also accelerated their layout of gold assets. Global gold ETF holdings saw a big explosion in February, increasing by about 3 million ounces, among which the world’s largest gold ETF (GLD) recorded the largest weekly net inflow in history (about US$4 billion) in late February.

SPDR Gold Trust Gold ETF Fund Flows Source: Macromicro

Considering the trend of gold and the current market sentiment, it seems that it is only a matter of time before the price of $3,000 is reached. Earlier this year, major financial institutions began to raise their forecasts for gold prices in 2025. Among them, Macquarie Group predicted in its latest report that the gold price will reach as high as $3,500 in the third quarter of this year. If the US M2 money supply is used as a reference, the gold price is still at a historically low level.

Gold price/US M2 money supply Source: Tradingview

Factors that may lead to a short-term adjustment in gold prices include the end of the five-wave rally and profit-taking, a significant reduction in tariffs and geopolitical risks, or a global panic leading to a recurrence of “selling everything”.

XAUUSD daily chart Source: Tradingview

It is also worth noting that the current gold-silver ratio is near its highest level in the past three years, and silver has not yet broken through last October’s high of $35, so investors can also pay appropriate attention to silver trading opportunities.