As the spot gold price exceeded an all-time high of $4,000 per ounce on Wednesday, Haywood Cheung, chairman of the Hong Kong Gold Exchange, predicted that gold prices will reach $4,500 per ounce before Chinese New Year in mid-February, providing an opportunity for Hong Kong to accelerate plans to establish itself as an international gold trading center.
In an exclusive interview with China Daily, Cheung said that all investment products, including precious metals like gold, follow market cycles. Over the past 10 to 15 years, assets such as real estate, bonds, and equities have dominated the cycles, while gold prices remained stable. But given that gold has consolidated steadily over the past five to six years, Cheung said he believes the market is entering an upcycle for gold and other precious metals.
“I’m very optimistic about gold prices,” he said, adding that “we are in a bull market”.
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On Wednesday, spot gold prices surpassed $4,000 per ounce for the first time, a rise of more than 50 percent since the start of the year.
The surge in metal prices has reportedly been driven by growing concerns over stagflation in the United States, characterized by slowing economic growth and persistent inflation. Amid heightened global economic and political uncertainties, investors are choosing gold as a safe-haven asset.
Goldman Sachs raised its year-end 2026 gold price forecast from $4,300 to $4,900 per ounce on Monday, citing strong demand from long-term buyers including central banks. The bank expects central banks worldwide to purchase an average of 70 to 80 metric tons of gold annually in 2025 and 2026 as part of efforts to diversify reserve portfolios.
In his fourth Policy Address, delivered in mid-September, Hong Kong Chief Executive John Lee Ka-chiu outlined plans to speed up the special administrative region’s development as an international gold trading market.
Lee announced that the SAR government will support the Airport Authority Hong Kong and financial institutions in building gold storage facilities, with a target capacity of over 2,000 tons within three years.
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Other measures include the establishment of a central clearing system for gold transactions in the city, which will provide efficient and reliable clearing services in line with international standards. The government also plans to invite the Shanghai Gold Exchange to participate, preparing for mutual market access with the Chinese mainland.
Gaby Lin contributed to the story.
Contact the writer at irisli@chinadailyhk.com
