Gold prices could surge to nearly USD 5k an ounce if the Federal Reserve’s independence is compromised, the Financial Times reports, citing forecasts by Goldman Sachs. The bank's base case scenario is a rise to USD 4k per troy ounce by mid-2026, but a 1% shift of private investment from US Treasuries to gold could drive the price even higher.

The rationale: “A scenario where Fed independence is damaged would likely lead to higher inflation, lower stock and long-dated bond prices and an erosion of the USD’s reserve currency status,” co-head of global commodities research at Goldman Sachs Daan Struyven told the FT.

Gold has already rallied 35% this year to over USD 3.5k an ounce, becoming a top-performing global asset. Both investors and central banks have been increasing their holdings in the precious metal as a hedge against political uncertainty, debt, and potential inflation from a politicized Fed, especially as traditional havens like the USD and government bonds falter.

The Trump effect on Gold: Concerns over US President Trump’s pressure on the central bank prompted European Central Bank head Christine Lagarde to warn of a “very serious danger” to the global economy. The uncertainty is boosting demand for gold, said Hargreaves Lansdown’s Derren Nathan, in a separate BBC report. The trend was echoed by Pictet Asset Management's Arun Sai, who said the political climate reinforced his firm's decision to maintain a significant gold position.

Fed under pressure: The Justice Department has opened a criminal mortgage fraud investigation into Federal Reserve member Lisa Cook, a move critics describe as a politically motivated escalation of the Trump administration's effort to oust her and put pressure on Fed Chair Jerome Powell to lower interest rates, The Washington Post reported, citing sources it said are in the know. Resignations and ended terms are increasingly tipping the balance of the Fed board in Trump’s favor.

TASI

10,656

+0.3% (YTD: -11.5%)

MSCI Tadawul 30

1,382

+0.5% (YTD: -8.5%)

NomuC

25,560

-0.4% (YTD: -18.8%)

USD : SAR (SAMA)

USD 3.75 Sell

USD 3.75 Buy

Interest rates

5.0% repo

4.5% reverse repo

EGX30

34,762

-1.1% (YTD: +16.9%)

ADX

10,034

-0.2% (YTD: +6.5%)

DFM

5,989

+0.3% (YTD: +16.1%)

S&P 500

6,482

-0.3% (YTD: +10.2%)

FTSE 100

9,208

-0.1% (YTD: +12.7%)

Euro Stoxx 50

5,318

-0.5% (YTD: +8.6%)

Brent crude

USD 65.50

-2.2%

Natural gas (Nymex)

USD 3.05

-0.9%

Gold

USD 3,653

+1.3%

BTC

USD 110,138

-0.6% (YTD: +17.7%)

Sukuk/bond market index

914.55

+0.09% (YTD: +1.38%)

S&P MENA Bond & Sukuk

149.46

+0.5% (YTD: +6.8%)

VIX (Volatility Index)

15.18

-0.8% (YTD: -12.5%)

THE CLOSING BELL: TADAWUL-

The TASI gained 0.3% on Thursday’s close on turnover of over SAR 3.2 bn. The index is down 11.5% YTD.

In the green: Thimar (+6.0%), Saudi Fisheries (+4.2%) and Al Andalus (+3.9%).

In the red: Build Station (-5.7%), Taiba (-4.4%) and Al Ahli Reit (-2.7%).

THE CLOSING BELL: NOMU-

The NomuC closed 0.4% down on Thursday on turnover of SAR 40.7 mn. The index lost 18.8% YTD.

In the green: Horizon Food (+9.4%), Al Naqool (+7.0%) and Intelligent Oud (+6.8%).

In the red: Horizon Educational (-13.3%), Sign World (-10.0%) and Osool and Bakheet (-9.9%).

CORPORATE ACTIONS-

#1- Munawla Cargo Company’s board approved a 50% capital increase to SAR 30 mn, it said in a disclosure to Tadawul on Thursday. The move aims to raise the number of shares to 3 mn from 2 mn by issuing one bonus share for every two shares held.

ALSO- The company’s board greenlit a SAR 1.5 mn dividend payout for 1H 2025 at SAR 0.75 per share, it said in a separate disclosure on Thursday. The distribution date is set for 28 September.

#2- Arabian Food and Dairy Factories Co. will distribute over SAR 2.1 mn in interim dividends for 1H 2025 at SAR 1.5 apiece, starting 5 October, it said in a Tadawul disclosure on Wednesday.

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