The New Gold Rush: Why This Precious Metal is Suddenly Worth More Than Ever

The Gold Rush: Prices Soar to New Highs - What Are the Reasons and How Does It Affect Our Pockets?

In a period of economic and geopolitical uncertainty, gold is once again proving its status as a "safe haven," and investors are flocking to it. The growing demand, alongside other factors, is pushing the prices of the precious metal to new highs. As of early September 2025, the price of pure gold (24 karat) in Israel is around 380 shekels per gram, and the price of a gold ounce (approx. 31.1 grams) in international markets has crossed the $2,300 threshold, marking a significant increase in the recent period.

The rise in the price of gold is not a fleeting phenomenon. It reflects a global trend influenced by several key factors, chief among them the lack of global economic stability. Rising inflation in many countries around the world is eroding the purchasing power of money, causing investors to seek investment channels that will preserve the value of their capital. Gold, being a tangible commodity with a long history of value preservation, serves as an attractive alternative.

Another significant factor is the monetary policy of central banks worldwide. In a period of low interest rates, holding cash or other conservative investments yields low returns. Interest rate cuts, or expectations of them, make gold, which bears no interest, relatively more attractive. Additionally, central banks around the world, especially in countries like China and Russia, are increasing their gold reserves, which boosts global demand and raises prices.

The growing geopolitical tension in the world also has a direct impact on the gold market. Conflicts, wars, and political instability increase uncertainty and drive investors to seek "safe-haven assets." History shows that during times of international crisis, the price of gold tends to rise.

How Does It Affect Us?

The rise in gold prices affects many areas of our lives, sometimes directly and sometimes indirectly:

A Rise in Jewelry Prices: Consumers feel the increase most directly in the prices of jewelry. Jewelers and manufacturers are forced to pass the higher cost of the raw material on to the end customer, making the purchase of rings, necklaces, and other gold items more expensive.

Impact on Investors: For investors who hold gold, whether physically (bars and coins) or through financial instruments (ETFs and futures contracts), the price increase constitutes a capital gain. Many investors see gold as an important component of their investment portfolio, as a tool for diversification and as a hedge against volatility in the stock and bond markets.

Impact on Industry: Gold is not only used for jewelry and investments. It also has industrial applications, mainly in the field of electronics, thanks to its high electrical conductivity and resistance to corrosion. A rise in the price of gold can increase production costs in these industries, indirectly affecting the prices of electronic products.

An Indicator of the State of the Economy: From a broader perspective, the rise in gold prices serves as an indicator of investor concerns about an economic slowdown and recession. When "smart money" flows into gold, it is often a sign of a lack of confidence in traditional financial markets and economic growth.

In conclusion, the surge in gold prices is a complex phenomenon that reflects the global economic and geopolitical situation. As long as uncertainty continues and inflation remains a significant factor, it is likely that gold will continue to attract the attention of investors worldwide, maintaining its status as a symbol of stability and security in a turbulent world.