Insights 
VT 
Gold prices in Malaysia rose to 550.91 Malaysian Ringgits (MYR) per gram on Monday, up from 545.73 MYR on Friday. The price per tola increased to 6,425.67 MYR, compared to 6,365.25 MYR.
Gold prices are updated daily, based on market rates and the USD/MYR exchange rate, as reported by FXStreet. These prices are for reference only, and local rates may vary slightly.
Gold as a Safe-Haven Asset
Gold serves as a store of value, widely used during unstable times as a safe-haven asset, and as a hedge against inflation and currency depreciation. Central banks are large holders, having added 1,136 tonnes worth about $70 billion to reserves in 2022.
The price of Gold is inversely correlated with the US Dollar and Treasuries, rising when the Dollar weakens. A rally in stocks tends to lower Gold prices, while market sell-offs often increase them.
Several factors can drive Gold prices, including geopolitical instability or the threat of recession, affecting its safe-haven status. Interest rates also impact Gold’s pricing, with lower rates generally pushing prices up, depending on USD behaviour.
With gold prices rising today, we should consider the underlying factors driving this move. The precious metal is often seen as a hedge against currency depreciation and economic uncertainty. The current upward trend suggests that derivative traders should be preparing for increased volatility and potential opportunities in the coming weeks.
Monetary Policy and Its Impact
We are now seeing signs of a slowing global economy, which is increasing bets on a more dovish monetary policy from the US Federal Reserve. Looking back, we saw inflation peak in 2022, and the latest US Consumer Price Index data from September 2025 showed inflation holding at 2.8%, making the Fed’s restrictive stance harder to justify. Markets are now pricing in a greater than 60% chance of a rate cut by the second quarter of 2026, which would weaken the dollar and further boost gold.
Geopolitical instability is also providing support for gold’s safe-haven status. Renewed trade disputes between the US and China over semiconductor technology are creating uncertainty in riskier assets like equities. This type of environment typically leads investors to seek safety in gold, a trend we have observed repeatedly, such as during the initial trade war escalation back in 2018 and 2019.
Central bank buying continues to provide a strong floor for the price. After the record-breaking purchases we saw in 2022, the World Gold Council confirmed that central banks in emerging markets continued to be net buyers through 2023 and 2024. This consistent demand from official institutions reinforces the view of gold as a primary reserve asset.
Given these bullish factors, traders should consider positioning for further upside in gold prices. A strategy of buying call options on gold futures, perhaps with expiration dates in early 2026, could capture potential gains from expected interest rate cuts. This approach allows for participation in a rally while defining the maximum risk involved in the trade.
