Gold prices have surged to an unprecedented $3,500 per ounce, marking a historic milestone in the global financial markets.
This remarkable rally is attributed to escalating geopolitical tensions, concerns over U.S. monetary policy, and a weakening dollar.
“This comes as Trump ratchets up pressure on Powell to ease monetary policy, raising concerns about Fed independence,” wrote ING commodities strategists in a Tuesday note, adding that exchange-traded fund holdings in gold are at their highest levels since September 2023.
Key Highlights:
- Market Drivers: The surge in gold prices is fueled by safe-haven demand amid uncertainty surrounding U.S.-China trade relations and President Donald Trump’s criticism of the Federal Reserve. Investors are flocking to gold as a reliable asset during turbulent times.
- Global Impact: The rally has lifted gold-backed exchange-traded funds and boosted mining stocks worldwide. Analysts predict further gains, with some forecasting prices to reach $4,000 per ounce by mid-2026.
- Economic Implications: The rise in gold prices reflects growing investor anxiety and a shift away from traditional assets like U.S. Treasury bonds.