Gold has surged to a record high as investors seek security in a volatile economic climate. On Tuesday morning, the spot price climbed to $3,508.50 per ounce. The rise continues a powerful rally that has boosted the metal by nearly a third this year.
Tariffs and uncertainty spark momentum
Gold thrives in times of economic stress. Earlier this year, its price jumped after President Donald Trump introduced sweeping tariffs. The move unsettled global trade and sent investors toward safer assets. Analysts also expect the US central bank to cut interest rates, making gold even more attractive.
Adrian Ash, research director at BullionVault, linked the rally to Trump’s policies. He said the surge reflects deep shifts in trade and geopolitics. Ash also highlighted that the US election last year gave fresh energy to the trend.
Federal Reserve under political fire
The metal’s climb also reflects worries about the Federal Reserve’s independence. Trump has repeatedly criticised Fed chair Jerome Powell. He even attempted to remove governor Lisa Cook.
Derren Nathan from Hargreaves Lansdown said Trump’s attacks weakened trust in the Fed. He argued this spurred demand for safe haven assets like gold. On Monday, European Central Bank president Christine Lagarde issued a warning. She said political interference in the Fed would pose a grave risk to the global economy.
Lagarde stressed that such influence could damage US stability and ripple through world markets.
Asia keeps buying despite high prices
Ash explained that gold rallies usually cool when jewellery buyers in China and India withdraw. Both nations are key markets for gold jewellery. Normally, soaring prices reduce purchases.
This time, demand remains firm. Buyers in China and India are shifting from jewellery to investment options like bars and coins. Their strong appetite supports gold’s record run, even at unprecedented price levels.
