Gold’s New Gravity: Record Highs Meet a Sticky 3% CPI

Matthew E. Bartone
Nov 4, 2025
5 min read

Updated: Nov 5, 2025

Gold’s New Gravity: Record Highs Meet a Sticky 3% CPI

Gold cools below $4,000/oz after a record‑setting October, but the bull run is anything but finished. You ask why? It’s quite simple. Gold is the only real form of money that responds to the debasement of Fiat currency purchasing power resulting from historic levels of monetary expansion, government suppressed interest rates, government deficit spending, and persistent trade deficits.

These factors have reached a point in U.S. history where foreign central banks are quickly reducing their exposure to U.S. Dollar denominated assets (primarily U.S. treasury bills, notes, and bonds) in exchange for physical gold reserves.

The asset bubble(s) created by poor U.S. fiscal and monetary policy over the last 17 years will create the perfect storm for much higher gold prices in the future.

By Matthew E. Bartone

Where is gold today?

Nov. 4, 2025 — Gold had been on a tear over the 60 days up to mid-October with a recent and sharp correction occurring over the last week and half. It feels like a pause, not a pivot. That is a correct assessment. This pause is natural as gold was overbought over its recent rise from $3,300 in mid-August 2025 to over $4,300 in mid-October 2025. All bull markets go through phases where prices often

consolidate and retrace and test the 200-day moving average. As of November 4^th, the 200-day moving average is approximately $3,400. Do we get that low during this consolidation phase? No one knows but the probability is high that we see a further consolidation in the $3,500 range before the next and final phase of this bull market intensifies.

How We Got Here

Why has gold broken out of its 17 year cup and handle illustrated in the price chart above? It’s actually quite simple and should have been easy to predict.

U.S. Government debt along with twin deficits of fiscal spending and trade deficits are the driving factor to higher gold prices.

Quietly, foreign central banks have been shedding U.S. denominated reserves in favor of physical gold holdings to offset the declining purchasing power of U.S. government debt (treasuries) and the risk of seizure by U.S. Government.

“This cycle is less about panic and more about policy, persistence, and positioning.”

The Quiet Bid: Central Banks

Foreign central bank gold purchases have been the unsung floor under prices. After several years of reserve diversification—away from pure dollar holdings and toward hard assets—central banks remain steady net buyers. That structural bid has turned routine dips into buying opportunities for both treasurers and private investors.

Inflation’s New Normal

Gold’s latest leg higher hasn’t required flaming inflation—just persistent inflation. The September CPI rose 0.3% monthovermonth and 3.0% yearoveryear, with core CPI also printing near 3%. That’s well off the 2022 peak, but these government published inflation rates are wildly under estimating true consumer price inflation levels.

Simple arithmetic and sector knowledge can quickly debunk the validity of U.S. government inflation statistics. Just use healthcare costs as an example.

Healthcare

Healthcare represents approximately 1/6^th of the U.S. economy. If healthcare costs are rising by 7% in 2025 and it represents 1/6^th of the economy then that would represent approximately 1.2% of the 3% annual inflation reported by the U.S. Government. That means that for the remaining 5/6^th of the economy, we are only seeing 1.8% price inflation. Does that seem reasonable to you? Of course not. Not when you see comments like this regularly on social media platforms.

What are three Catalysts to watch?

What we are likely to see is continued upward pressure on prices. This is especially true if the U.S. Supreme Court rules in favor of tariff levies on foreign produced goods and services.

Upward CPI price inflation will continue to add fuel to gold prices. Watch for sustained rises in CPI data which will validate that consumer prices are not coming down even with the economic headwinds that we are experiencing.

Watch U.S. Government debt levels and borrowings as well. U.S. Government debt recently surpassed $38 trillion. Debt expansion grew at its fastest rate with the most recent $1 trillion in U.S. debt added in a mere 82 days. This level of debt expansion is occurring even with tariff revenues reaching $25 billion per month.

As U.S. Government debt levels grow more quickly we are likely to see 10-year treasury bond yields stay at current levels (4.1%) but could also begin to rise as seen earlier this year. This is not a good signal for the market of U.S. Treasuries as debt service costs will accelerate adding further pressure to U.S. Government deficits. If this occurs, we will most likely see the Federal Reserve begin its transition to U.S. Treasury buying (Quantitative Easing) which effectively creates money out of thin air resulting in higher inflation. When we see this transition, this will be a major catalyst for much higher gold prices.

And lastly, for gold’s final phase of the bull market to begin we must see a sharp and sustained drop in the stock market. Why is that?

A sharp and sustained drop in the stock market is the catalyst for capital rotation out of equities and into safe haven assets, primarily gold and gold equities. This is the third and final component that is needed for the final bull market run up of gold prices.

Viewpoint: Why This May Still Be Early in the Gold Bull Run

Gold’s price action has been dramatic, but the underlying story feels more secular than cyclical. My base case: we are still early in a broader bull market for bullion.

I see this gold bull run lasting several years if not longer. Some say we may be entering a long term bull market as fiat currencies including the U.S. dollar continue their accelerating decline. More importantly they point to a 40 year bond market reversal beginning in 2022 when interest rates were raised to fight the initial round of inflation from the enormous and unprecedented money expansion during Covid. As bond values decline in rising interest rate environments, this traditional safe haven investment will be avoided and replaced by gold. This is exactly why central banks have been replacing their U.S. government bond holdings with gold.

I expect golds run to continue and accelerate into this decade with a five digit gold price projection ($10,000 or higher) before the end of this decade. This may be very conservative considering U.S. debt levels and debt service costs are growing exponentially from here forward.

Credits & Sources

World Gold Council. “Gold Demand Trends: Q3 2025.” World Gold Council – Goldhub, 30 Oct. 2025. Accessed 4 Nov. 2025.
Devitt, Polina. “Global Gold Demand Climbs 3% to Quarterly Record as Investment Soars, WGC Says.” Reuters, 30 Oct. 2025. Accessed 4 Nov. 2025.
John, Noel, and Pablo Sinha. “Gold Slips below $4,000 on Firm Dollar as Market Awaits Data for Fed Clues.” Reuters, 4 Nov. 2025. Accessed 4 Nov. 2025.
U.S. Bureau of Labor Statistics. “Consumer Price Index Summary — September 2025.” U.S. Bureau of Labor Statistics, 24 Oct. 2025. Accessed 4 Nov. 2025.
U.S. Bureau of Labor Statistics. “Schedule of Releases for the Consumer Price Index.” U.S. Bureau of Labor Statistics, 2025. Accessed 4 Nov. 2025.