The past month has been interesting. After taking two weeks off from LinkedIn and not keeping an eye on any market updates, I came back to South Africa seeing the gold price above $4.000/oz!

After a refreshing two weeks in Vietnam, I decided to do this month’s market update a bit different. Apart from publishing it later in the month than my previous two editions, I am also aiming at making these updates increasingly interactive. This market update will therefore be a bit shorter, only outlining the highlights of the past month with the aim of sparking further conversation on the current state of global markets and also where they are headed – hence the more conversational tone. Enjoy!

Gold Rockets to Record Highs

The gold price jumped over 10% in September, reaching an all-time high and now making up 15% of the JSE All Share Index.

We are also seeing new “drivers” of the gold price coming to the table as this increase is less about traditional inflation hedging and more about geopolitical tension, de-dollarisation, and central-bank buying.

What I found quite interesting, and also very relevant for us South Africans, is that  price-insensitive buying by BRICS nations and Gulf States (includes the UAE and Qatar) has surged since the Russia-Ukraine war, particularly after the freezing of Russia’s dollar reserves.

These central banks still hold only ~7% of reserves in gold (vs. 25% globally), meaning further buying potential remains high.

The Fed’s independence is still being questioned and with rising U.S. debt levels, investors are concerned with the dollar losing more of its value. Now the question with the current gold price and rallying equities is obvious – are we in a bubble?

As always, what about The Fed?

The Federal Reserve’s first rate cut of 2025 came with a twist: The Fed is trying to keep the economy steady by making borrowing cheaper, but it’s also watching out for rising prices. There’s some political pressure on the Fed to cut rates more aggressively, which could mean it’s less independent than before.

Many market watchers think the Fed’s “real” inflation target has quietly increased to 2.8%, even though the official goal is still 2%. This shift may be influenced by politics, especially with President Trump’s administration pushing for lower rates. Therefore, inflation remains a concern!

China, Emerging Markets, and Geopolitics

China’s President Xi Jinping recently hosted a major summit. The event was more than just a diplomatic get-together. It was a bold signal that China wants to reshape the global power structure.

Instead of a world dominated by the West (especially the U.S.), China is pushing for a multipolar world – where influence is shared among several regional powers. At the same time, China is keeping communication open with the U.S., especially around trade and tech issues like TikTok. So while it’s challenging Western dominance, it’s also being practical – attempting to balance competition with collaboration.

Emerging-market equities are up 27% in dollar terms year-to-date, helped by AI-driven tech growth in Asia and easing inflation that allows EM central banks to cut rates.

However, geopolitical risks remain high, with tensions escalating in Europe and the Middle East following aggressive U.S. and NATO responses to Russian incursions.

Final Thoughts

October has been a month of big moves and bigger questions. Gold has soared to record highs, driven not just by the usual worries about inflation, but by new forces like geopolitical tensions and central banks in BRICS and the Gulf States snapping up gold. The Fed’s first rate cut of 2025 shows that even the world’s most influential central bank is feeling the pressure.

Meanwhile, China is making bold moves to reshape the global power balance, and emerging markets are riding a wave of tech-driven growth.

My advice? Stay diversified, keep an eye on the data, and be ready for volatility. The world’s markets are recalibrating, and while that brings risk, it also brings opportunity. Let’s keep the conversation going and navigate these transitions together.