Gold in a fragmented world: Safe haven and strategic asset    

Key takeaways:

• Gold is reasserting its role as a strategic asset in a fragmented, multipolar world — favoured by central banks seeking alternatives to the US dollar amid geopolitical and monetary shifts
• Central bank demand has surged since 2021, especially in emerging markets, driven by reserve diversification, inflation concerns, and geopolitical uncertainty
• Gold improves portfolio resilience, offering low correlation to equities and bonds — particularly valuable when traditional asset classes move together during macro shocks
• Gold thrives in higher inflation regimes (0.4–0.6% monthly CPI), but its performance also hinges on real interest rates, monetary policy, and market sentiment
• A 60/20/20 equity/bond/gold portfolio has outperformed the traditional 60/40 since 2020 — delivering higher returns and better risk-adjusted performance amid rising volatility and inflation

Points of differentiation:

• Macro and Micro Demand Lens: This paper combines central bank policy, geopolitical shifts, and consumer seasonality to give a full-spectrum view of what drives gold demand today
• Portfolio Construction Focus: Goes beyond theory to show how gold boosts Sharpe ratios and cushions performance when equity-bond diversification breaks down
• Modern Use Cases: Highlights emerging demand from AI and tech, showing gold’s relevance in both financial markets and strategic industries

What does our research mean for investors?

For investors, this research shows that gold is becoming more important in today’s uncertain world. As deglobalisation and geopolitical tensions rise, and inflation stays sticky, traditional assets like equities and bonds are becoming more correlated, making it harder to diversify. Gold stands out as a stable, independent asset that holds value during market stress. Central banks, investors, and even tech sectors are increasing demand for gold. For multi-asset portfolios, adding gold can help smooth returns, protect capital, and offer resilience when other assets struggle. It’s no longer just a safe haven, it’s a strategic choice.