Gold prices have skyrocketed, reaching an all-time peak of $3,275.20 per ounce, amidst a perfect storm of factors contributing to the surge. As the global economic landscape continues to shift, investors are flocking to the safe-haven metal, seeking refuge in its value.

The Dollar’s Weakening Grip

A weaker US dollar has been a key driver of the gold price surge. The dollar index has fallen by 0.4% against its rivals, making gold more attractive for other currency holders. This trend is driven by the perception that the dollar is losing its value, which in turn increases the demand for gold.

• A dollar depreciation can make gold more expensive for investors, but it also increases the metal’s appeal.
• The weakening dollar is a result of the US government’s policy to increase the money supply, which can lead to inflation.
• A weaker dollar can also make other assets, such as the euro and yen, more attractive to investors, reducing demand for gold.

Escalating Trade Tensions

Trade tensions between the US and China have been escalating, with Nvidia announcing it will take a $5.5 billion charge due to the US government’s restriction on exports to China. China has responded by ordering its airlines not to take any further deliveries of Boeing jets. This escalation of tensions has increased uncertainty, making gold a more attractive investment.

1. US-China trade tensions have been ongoing for several years, but recent escalations have increased investor uncertainty.
2. The restrictions on exports to China have had a significant impact on the tech industry, with companies like Nvidia facing significant costs.
3. China’s response to the US restrictions has been to limit its purchases of Boeing jets, which could have a significant impact on the airline industry.

A Safe-Haven Asset

Gold has traditionally been viewed as a safe-haven investment during times of geopolitical and economic uncertainty. Its price has been volatile, but it has consistently shown a strong correlation with inflation and economic growth.

“Gold will continue to be strong as long as there’s uncertainty,” said Brian Lan, managing director at GoldSilver Central.

Record Highs and Strong Performance

Gold has hit multiple record highs this year and is up over 24% so far in 2025. This strong performance is driven by a combination of factors, including the weakening dollar and escalating trade tensions.

< td >Gold Price ($/oz)

< tr >
< td >2020

< td>$1,920.50

< tr >
< td >2022

< td>$1,900.20

< tr >
< td >2023

< td>$2,000.00

< tr >
< td >2024

< td>$2,450.00

< tr >
< td >2025

< td>$3,275.20

Analysts’ Forecasts

Analysts at ANZ have raised their year-end gold price forecast to $3,600 per ounce and six-month forecast to $3,500. They believe risk-off purchases for gold are yet to pick up, but the metal will continue to be strong as long as there’s uncertainty.

Awaited Data and Market Expectations

Investors now await US retail sales data, due later in the day, on insights into the economy and the Federal Reserve’s monetary policy trajectory. Traders currently expect around 87 basis points of Fed rate reductions by end-2025.