**Gold Prices as a Safe Haven** Gold prices in Malaysia dropped on Friday, according to FXStreet. The price per gram went down to MYR 599.96 from MYR 600.89 the day before. Prices also decreased to MYR 6,997.95 per tola, down from MYR 7,008.68 earlier. The price for a Troy Ounce is now MYR 18,660.88. FXStreet calculates Malaysia’s gold prices by converting international rates to local currency and updating them daily. Keep in mind that local prices may vary slightly as these figures are mainly for reference. Gold is not only used for jewelry; it is also considered a safe-haven asset during economic uncertainty. Investors often turn to gold as a hedge against inflation, providing stability regardless of government actions. Central banks buy gold to strengthen their economies. In 2022, they purchased 1,136 tonnes, valued at around $70 billion, marking a record high. Gold prices tend to move in the opposite direction of the US Dollar and Treasuries. A weaker Dollar can increase gold prices, while a stronger Dollar might lower them. **Strategies for Market Volatility** Economic instability often raises gold prices due to its safe-haven status. When interest rates are low, gold becomes more appealing; higher rates generally make it less attractive. Currently, we see a small dip in gold prices, but this is just a minor fluctuation in a broader context. The real value of gold is linked to its inverse relationship with the US Dollar, which has been strengthening due to recent economic reports. This situation is causing tension in the market that we should watch closely. The main factor to consider is the policy of central banks, especially the US Federal Reserve. After the recent US inflation report in December 2025 showed inflation at 2.9%, the market now expects a slower pace of interest rate cuts this year. Anticipation of higher rates for an extended period puts pressure on gold, as it does not generate interest. However, strong demand for physical gold provides solid support. According to the World Gold Council data for the third quarter of 2025, central banks, especially the People’s Bank of China, continued to increase their reserves at almost record levels. This steady buying serves as a price floor, making significant dips likely short-lived. Given these mixed signals, traders should explore strategies that benefit from volatility instead of making a straightforward bet. The CBOE Gold Volatility Index (GVZ) has been rising from the lows we saw last fall, now sitting around 16.5 this week. This indicates that options are becoming more valuable as uncertainty about the Fed’s decisions and global stability increases. We recommend moving away from simple long or short futures positions. Instead, consider buying call options to capture potential gains from any unexpected dovish shift by the Fed, while using put options to hedge against a stronger dollar if upcoming US economic data remains strong. This balanced approach is more fitting for a market experiencing conflicting forces. **Create your live VT Markets account and start trading now.**

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