Gold has surged past the $5,000-per-ounce mark for the first time. This is as investors piled into the precious metal amid rising geopolitical tensions and renewed volatility in global markets.
As of 12:00 pm WAT on Monday, spot gold prices stood at $5,092 per ounce, according to data from goldprice.org. The move represents an 11 percent rise in a week. It also marks gold’s strongest weekly performance since the 2008 global financial crisis, according to the Financial Times.
The latest rally extends a historic two-year surge in bullion prices. The move has been driven by heightened geopolitical risk, sustained investor demand, and aggressive buying by central banks seeking to reduce their exposure to the US dollar.
Market jitters intensified last week as trade tensions between the United States and Europe resurfaced. US President Donald Trump threatened to impose tariffs on European allies. He warned that the measures would follow if they resisted his demands for greater US control over Greenland. The remarks unsettled investors. They triggered a sharp sell-off on Wall Street. An abrupt policy reversal midweek, however, helped stocks stage a partial recovery.
Equities rebounded, but the US dollar failed to recover fully. It remained under pressure through the week. An index tracking the dollar against major peers, including the euro and the pound, fell 1.9 percent. A weaker dollar typically supports gold prices. It makes the dollar-denominated metal cheaper for investors using other currencies.
Beyond near-term geopolitical shocks, analysts point to deeper structural shifts in global markets. Gold’s rally, they say, reflects changing reserve management strategies.
Central banks have stepped up bullion purchases. This has been particularly pronounced in emerging markets. The aim is to diversify reserves away from the dollar. For most of them, gold serves as a hedge against sanctions risk and currency volatility.
Investor demand has been further supported by persistent inflation concerns. High public debt levels in advanced economies have added to the appeal. Expectations that global monetary policy may remain looser for longer have also played a role.
With policy uncertainty in the United States adding another layer of risk, particularly around the future independence of the Federal Reserve, market watchers say gold plays a role as a hedge against financial and political instability. And it is likely to remain firmly in focus, even after its record-breaking climb.