Gold has long served as a safe haven for investors worried about inflation or economic turmoil. Now a new source of demand is emerging from an unexpected place: the artificial intelligence industry.
Building out AI infrastructure—advanced semiconductors, servers and massive data centers—requires materials prized for performance in high-end electronics, and gold is one of them. That need is growing even as gold trades at historically high prices, roughly $4,153 an ounce as of Oct. 5, up nearly 6%, or about $225, from a year earlier.
Gold is used in electronics because of its conductivity, reliability and resistance to corrosion. Typically, companies look to swap out gold for cheaper alternatives once a technology matures. But that isn’t happening with AI-related production, according to Joseph Cavatoni, a gold market expert and senior market strategist for North America at the World Gold Council.
“They might pioneer a technology with gold involved and then say, ‘Let’s find something cheaper like tungsten to replace it,'” Cavatoni told Fox News Digital. “But what we’re finding in this case is they’re not.”
The numbers back that up. Gold demand from the technology sector rose 2% year-over-year to 80.4 metric tons in the second quarter, according to the World Gold Council. Within that, electronics demand climbed 4% to 68.3 tons, driven by AI infrastructure, high-end semiconductors and advanced components.
Cavatoni said gold offers performance advantages over substitutes in applications like chip production and heat conduction. He also noted the AI sector may be less deterred by high gold prices simply because the amounts of gold used in each component are relatively small.
“This is a rapidly growing space that’s less sensitive to price,” Cavatoni said. “It’s going to likely continue to grow as the AI space grows.”
Even so, technology remains a small slice of the overall gold market compared with investment demand, central-bank purchases and jewelry. Cavatoni said it is “less likely to be a driver of the price of gold” overall, but described it as a steadily growing contributor to demand that “doesn’t appear to be slowing down anytime soon.”
