Gold prices in Malaysia decreased on Tuesday, as per FXStreet data. The price dropped to 590.18 Malaysian Ringgits (MYR) per gram from MYR 591.87 on Monday, while the price per tola decreased to MYR 6,883.67 from MYR 6,903.50.

Gold’s price calculation in Malaysia is based on international prices (USD/MYR) adjusted to local currency, with daily updates reflecting market rates. These prices serve only as a reference, and local rates may vary slightly.

Gold As A Safe Haven Investment

Gold is historically valued for its role as a store of value and medium of exchange. It is considered a safe-haven asset during volatile times and is viewed as a hedge against inflation and currency depreciation. Central banks hold the most Gold, with 1,136 tonnes purchased in 2022.

Gold typically shows an inverse correlation with the US Dollar and US Treasuries. It tends to rise when these assets depreciate, serving as a diversification tool. The price of Gold is influenced by geopolitical instability, recession fears, interest rates, and the behaviour of the US Dollar. A stronger Dollar generally suppresses Gold prices, while a weaker Dollar can increase them.

The minor dip in gold prices to around MYR 590 per gram is just daily noise against a much larger backdrop. We are seeing a classic tug-of-war between high interest rates, which typically pressure gold, and strong underlying demand. The key is to look at the bigger forces at play, not just one day’s movement.

The US Federal Reserve has held interest rates firm throughout 2025 to combat inflation that has remained stubbornly above 3%. This policy strengthens the US dollar and makes non-yielding assets like gold less attractive for now. We saw this correlation play out repeatedly during the rate hike cycle that began back in 2022.

Central Bank Buying Spree

However, a powerful floor seems to be supporting the price against further significant drops. Central banks have continued their aggressive buying streak seen in previous years, with data from the World Gold Council showing they have already added over 800 tonnes to reserves this year. This sustained demand, particularly from emerging markets, provides a strong buffer.

Geopolitical instability also remains a key factor, with unresolved tensions in several regions keeping safe-haven demand alive. This underlying uncertainty is why implied volatility in gold options has not collapsed, despite the range-bound price action over the last few months. The market is clearly pricing in the risk of a sudden event.

For the coming weeks, we should consider strategies that benefit from this tension. Selling out-of-the-money puts could be a way to collect premium, capitalizing on the strong central bank support around the $1,980 per ounce level (approximately 18,350 MYR). This approach works well if we expect the price to remain stable or rise slightly.

We must also be positioned for a potential shift in Fed policy heading into 2026. Any indication that rate cuts are on the horizon could trigger a significant rally in gold. Using long-dated call options allows us to position for this upside with limited risk, should the high-rate environment persist longer than expected.

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