December 22, 2025
Article from MarketWatch by Jules Rimer
Article Synopsis
The article argues that gold’s surge to record highs, up about 68% this year, is being driven primarily by fears that central banks will monetize government debt, reviving the “great debasement trade.” Economists point to recent Federal Reserve rate cuts and dovish signals, alongside geopolitical tensions, as key catalysts boosting gold’s safe-haven appeal.
The rally extends beyond metals, with even low-debt currencies like the Swiss franc and Swedish krona increasingly correlating with gold, suggesting broader concern about currency debasement. Additional support is coming from the yen carry trade, as investors borrow yen to fund positions in higher-yielding assets, including precious metals.
