GOLD PRICES jumped above $3800 per Troy ounce on Monday and silver also set fresh all-time highs in many major currencies as the US Dollar dropped ahead of tomorrow's looming US government shutdown and gold ETF investment funds saw their biggest inflows since the start of Russia's war on Ukraine in 2022, writes Atsuko Whitehouse at BullionVault.

Spot gold prices spiked as high as $3831 per ounce Monday lunchtime in London, shooting 1.6% above Friday's finish before edging back $10 by 3pm to set the 'safe haven' precious metal's 37th new all-time benchmark auction high of 2025 to date.

The price of silver, which finds nearly 60% of its annual demand from industrial uses, had earlier surged by more than $1 per ounce during Asian trade, up 2.3% to a 14-year high of $47.17, before slipping back to fix just shy of the $47 level at noon's London benchmark auction.

Latest data says that while the giant iShares Silver Trust ETF (NYSEArca: SLV) shrank Friday from its largest size in more than 3 years, September inflows into gold ETFs mean their bullion backing has swelled almost 100 tonnes this month, according to the mining industry's World Gold Council, just behind April's 37-month record.

"This month's sharp $400 surge from $3400 to $3800 is because Western institutional investors and hedge funds have become increasingly aware of the risk of not holding gold as its price rises," says Bruce Ikemizu, chief director of the Japan Bullion Market Association.

After central-bank gold buying was widely seen driving the metal higher in recent years, gold's current surge is "supported by strong underlying demand from funds through ETFs," agrees derivatives platform Saxo Bank in its latest note, also pointing to the 'fear of missing out' among wealth managers, plus an "additional focus on the risk of a potential government shutdown on Wednesday."

US President Donald Trump will meet lawmakers on Monday in an effort to break the deadlock and avoid a costly government shutdown. Federal funding will expire on Tuesday if no agreement on short-term funding is reached.

The last such shutdown, which also came when Congress and the White House failed to agree additional funding during Trump's first term, affected around 1/4 of all federal government activity.

Gold rose 3.5% during that 35-day shutdown – the longest in US history – surpassing the 21-day shutdown of 1995-1996 during Democratic President Bill Clinton's term.

Today the Dollar Index – a measure of the US currency's value versus its major peers – fell 0.2%, extending its decline from last Thursday's 5-week high.

But US Treasury bonds rose in price, pushing down 10-year yields – a benchmark rate for government as well as for many financial and commercial borrowers – by 0.3 percentage points to a 1-week low.

Gold prices on the Shanghai Gold Exchange last night surged 1.2% to a new record of ¥862 per gram, but bullion in the world's No.1 gold mining, importing, consumer and central-bank buying nation continued to show a deep discount to London prices, widening to $50 per ounce – the highest since the Covid-crisis lockdown in September 2020 – and signalling poor demand versus supply.

London gold bullion in UK Pounds and Euros also surged 1.6% on Monday to new all-time highs, peaking at £2850 and €3268 per Troy ounce respectively.

Silver's strength pushed the Gold/Silver Ratio – which tracks the relative prices of the two formerly monetary metals – down further to just above 81, its lowest level in 12 months, while silver in UK Pounds topped £35 for the first time in history.

Silver also set a new Japanese Yen record above ¥224 per gram, while the Euro price of the industrially-useful metal rose to new 45-year highs at €40 per ounce.

Platinum − used in autocatalysts to cut harmful emissions from fossil-fuel engine systems, including hybrid-electric vehicles − meantime jumped 3.0% to a 12-year high of $1628 per ounce before halving that gain at $1600, and it hit a new all-time high in the JPY of ¥7,598 per gram.

Gold prices for Japanese retail investors today jumped through the psychological level of ¥20,000 per gram when including consumption tax.