Gold futures (GC=F) surged to a record $3,600 on Tuesday, lifted by investor expectations of a rate cut from the Federal Reserve this month and continued strong demand from foreign central banks.

Gold for immediate delivery also surged to an all-time high above $3,533 per troy ounce.

Gold's new records come as foreign central bank holdings of the precious metal have topped US Treasurys for the first time since 1996, according to Bloomberg data compiled by Crescat Capital macro strategist Tavi Costa, posted on X.

"This is likely the beginning of one of the most significant global rebalancings we've experienced in recent history, in my view," he wrote.

A central bank survey by the World Gold Council showed that an overwhelming majority of respondents believe global central bank gold reserves will increase over the next 12 months.

Read more about gold prices and today's market action.

Foreign central banks now officially hold more gold than US Treasuries — for the first time since 1996.

Let that sink in.

If you think this buying streak is ending, just look at what happened in the 1970s.

This is likely the beginning of one of the most significant global… pic.twitter.com/raSaQJqYu2

— Otavio (Tavi) Costa (@TaviCosta) August 28, 2025

Tuesday's price action comes ahead of this week's monthly jobs report. A softer-than-expected labor report could increase investor bets on a bigger-than-anticipated rate cut when the Federal Reserve meets later this month. Markets are currently pricing in roughly a 90% probability of a 25-basis-point cut in September.

Lower rates generally boost gold prices since the metal becomes more attractive when interest-bearing assets pay less.

Concerns over a resurgence in inflation and growing conviction that the Fed will soon resume its easing cycle have helped lift gold prices, Pepperstone research strategist Ahmad Assiri said.

"In this sense, gold has become a barometer of market unease and uncertainty across inflation, monetary policy and employment," he added.

Read more: How to invest in gold in 4 steps

Gold futures are up 36% year to date, far outperforming the S&P 500 (^GSPC) or even bitcoin (BTC-USD), which are up 8% and 19%, respectively, during the same period.

The precious metal gained more than 3.5% in August, extending its monthly winning streak for the year.

JC Parets, founder of allstarscharts.com, notes that since 1968, gold has never closed higher for eight consecutive months, until now.

"This streak is unprecedented, and it's not happening in a vacuum - it's the result of extraordinary global demand," he wrote on Monday. "From central banks adding to their reserves, to investors hedging against inflation and currency debasement, the appetite for Gold is unlike anything we’ve ever seen."

Wall Street doesn't see the bull running stopping here.

On Tuesday, UBS reiterated its forecast of $3,700 per ounce by June 2026, noting that an increase to $4,000 "in a risk scenario where geopolitical or economic conditions deteriorate cannot be ruled out."

Earlier this month, Goldman Sachs analysts reaffirmed its forecast of $4,000 per troy ounce for mid-2026, "driven by structurally strong central bank demand and ETF-inflows" supported by Fed easing.

Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.

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