The price of gold surged to a record high on Tuesday, reflecting strong demand for the precious metal amid global economic uncertainty. The spot gold price reached $3,508.50 per ounce, extending a rally that has seen it rise nearly one-third this year.
Gold is widely regarded as a safe-haven asset, attracting investors when economic or geopolitical risks increase. The metal’s recent ascent followed announcements of sweeping US tariffs under President Donald Trump, which disrupted global trade and heightened market anxieties.
Analysts also point to expectations of potential interest rate cuts by the US Federal Reserve as a factor boosting gold’s appeal. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold, making them more attractive to investors.
Adrian Ash, director of research at BullionVault, said that the spike in gold prices was largely driven by Trump’s impact on geopolitics and global trade. “It was really the US election last year that put a fire under it,” he said, highlighting the uncertainty caused by policy shifts.
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Concerns over the independence of the Federal Reserve have further contributed to investor interest. Trump has repeatedly criticized Fed Chair Jerome Powell and even attempted to remove governor Lisa Cook, prompting fears that political interference could destabilize US monetary policy.
Derren Nathan of Hargreaves Lansdown noted that these developments have heightened demand for safe-haven assets, including gold. Christine Lagarde, president of the European Central Bank, warned that undermining the Fed’s independence would pose a “very serious danger” to the global economy, affecting both US and worldwide economic stability.
Unlike previous surges in gold prices, demand from China and India—two of the world’s largest markets for gold jewelry—has remained strong. Instead of reducing purchases, buyers are increasingly turning to investment products such as gold bars and coins, sustaining upward pressure on prices.
As global uncertainty persists, analysts expect gold to remain in demand as investors continue to seek protection against trade tensions, interest rate volatility, and geopolitical risks.
