The price of gold has reached a new all-time high of over $3,245 per ounce, as financial markets respond to mounting instability linked to the United States’ trade policy.
The surge follows a series of statements from US President Donald Trump indicating potential new tariffs, contributing to increased investor uncertainty and a weakening US dollar.
According to Bloomberg, gold has become increasingly attractive to foreign investors due to the depreciation of the dollar, in which the precious metal is priced. The prospect of further protectionist measures from Washington, alongside volatility in currency markets, has led to a sharp rise in demand for traditional safe-haven assets.
The price of gold rose by more than 6% over the past week and has gained over 20% since the beginning of 2025. Analysts attribute the increase to several converging factors, including fears of a global economic downturn, continued monetary easing, and the US dollar’s recent slide to its lowest level since October, as measured by the Bloomberg Dollar Spot Index.
Chris Weston, Head of Research at Pepperstone Group, described the gold market as reacting with unusual strength: “Gold appears to be a clear beneficiary of the ongoing debate surrounding the US dollar, and we’ve seen its price behaving like an absolute beast.”
President Trump’s latest comments have unsettled global markets. While he announced a temporary pause on certain tariffs affecting popular electronic goods, he also confirmed plans to impose separate duties in the near term. This ambiguity has fuelled concerns among investors about the direction of US trade policy and its potential repercussions on international commerce.
In a related development, China has raised tariffs on selected American imports to as high as 125%, in retaliation against earlier moves by the United States. According to White House officials, the current effective US tariff rate on Chinese goods now stands at approximately 145%, reinforcing the perception that a renewed escalation in the trade conflict is under way.
The developments have prompted investors to move capital into traditionally stable assets, including gold, platinum, and palladium. While the price of silver declined slightly, both platinum and palladium showed positive momentum during the same period.
This trend marks a continuation of broader market movements seen throughout the year. Central banks in several emerging economies have also increased their gold reserves in response to geopolitical tensions and uncertainties surrounding the future of global trade frameworks. The combination of demand from institutional investors and central banks has contributed to sustained upward pressure on gold prices.
Despite the rally in precious metals, financial analysts caution that volatility may persist in the coming months. The possibility of interest rate adjustments by the US Federal Reserve, along with evolving geopolitical events and trade negotiations, are expected to influence market sentiment further.
The record high in gold comes just days after it crossed the psychologically significant $3,200 threshold for the first time on 11 April. That milestone was reached amid heightened concerns over a potential economic slowdown and as investors digested reports of a deepening rift in US-China trade relations.
Gold’s performance in early 2025 has significantly outpaced many other asset classes, reflecting a broader risk-averse posture among global investors. While equities have shown mixed results and government bond yields remain compressed, gold continues to benefit from its status as a hedge against both inflation and geopolitical uncertainty.
The outlook for precious metals remains closely tied to macroeconomic signals, particularly those emanating from Washington and Beijing. Market participants will be watching closely for further policy announcements from the White House, as well as any response from major trading partners.
As the geopolitical and economic environment remains unsettled, analysts suggest that gold may continue to see support in the near term, with some predicting that prices could push even higher if tensions persist.
