Gold Prices in Malaysia
Gold prices in Malaysia dropped on Monday, according to FXStreet data. The price was 588.56 Malaysian Ringgits (MYR) per gram, compared to MYR 590.67 on the previous Friday.
The cost per tola also decreased, reaching MYR 6,864.69 from MYR 6,889.41. Prices for 10 grams were MYR 5,885.45, and a troy ounce equalled 18,305.82 MYR.
Prices were based on international rates, converted to local currency, and adjusted daily. FXStreet notes these totals are for reference, with possible local divergences.
A Popular Asset During Uncertain Times
Gold remains a popular asset, due to its historical use as a value store and exchange medium. It is a preferred choice in uncertain times and as a hedge against inflation, independent of government or issuer control.
Central banks are the primary buyers, adding 1,136 tonnes worth $70 billion to reserves in 2022. This trend includes increasing reserves by China, India, and Turkey to support economies and currencies.
Gold’s price correlations include a negative relationship with the US Dollar. A declining Dollar often results in rising Gold prices, while stock market rallies tend to suppress Gold. Meanwhile, geopolitical tensions can lead Gold prices to rise.
With gold pulling back from its record high near $4,550, we see this as a temporary pause before the next move. This slight dip is likely due to thin holiday trading and some profit-taking ahead of the new year. For derivative traders, this consolidation period offers a chance to position for early 2026 volatility.
The primary driver for gold remains the dovish outlook for the US Federal Reserve. Market pricing now indicates a greater than 75% probability of the first interest rate cut happening by the March 2026 meeting. As a non-yielding asset, lower interest rates will continue to act as a significant tailwind for the metal.
This is reinforced by the persistent weakness in the US Dollar, which has an inverse relationship with gold. The US Dollar Index (DXY) has fallen below the key 100 level, a drop of over 5% since its highs earlier in 2025. A weaker dollar makes gold cheaper for holders of other currencies, which generally supports demand.
Political Uncertainty and Central Bank Demand
We must also factor in the added layer of political uncertainty surrounding the Federal Reserve. With Jerome Powell’s term ending in May 2026, the nomination of a new Fed chair by President Trump introduces unpredictability into future monetary policy. This kind of uncertainty typically boosts the appeal of safe-haven assets like gold.
Underpinning the market is the continued strong demand from central banks, which we’ve seen throughout 2025. Following record purchases in 2022 and 2023, central banks from emerging economies are on track to add over 950 tonnes to their reserves this year. This provides a solid floor for prices and limits significant downside risk.
Looking at the derivatives market, implied volatility remains relatively low, making options strategies attractive. We are seeing an uptick in demand for call options with February and March 2026 expiration dates, suggesting traders are positioning for a renewed rally. Buying call spreads could be a cost-effective way to bet on further upside.
However, a strong economic outlook for 2026 could create headwinds if it fuels a rally in risk assets. The S&P 500 gained nearly 20% in 2025, and a continued “risk-on” environment could draw funds away from gold. Therefore, traders might also consider purchasing protective puts to hedge against a potential economic surprise that strengthens the dollar.
