As confidence in dollar assets has weakened, the shift of money into gold has become pronounced, with central bank buying and retail investment demand rising in parallel.

Central banks have been enlarging their gold holdings for several years. The motive cited is reducing the risk of concentrating reserves in a single currency: gold has no issuer and so is not subject to any one government's policy decisions.

Retail demand is also growing. In South Korea, purchases of physical bars and inflows into gold exchange-traded funds have both increased, while demand for jewellery and investment bars remains firm across Chinese-speaking markets.

Gold, however, pays no interest or dividend. Holding costs rise when rates are high, so upward pressure typically strengthens when rate cuts are anticipated. Analysts largely attribute the current move to rate expectations and currency confidence acting at once.

Investors entering after a run-up bear volatility risk. Gold prices react sharply to geopolitical events and frequently move a long way in a short time.

Buyers of physical metal should weigh dealing spreads, taxes and storage costs. Value-added tax treatment and capital gains rules differ by country, so households holding assets across several jurisdictions should check in advance.