Gold Prices Surge to Near Record Highs Amid Market Uncertainty
All three metals were on track for weekly gains as well.
ISLAMABAD: Gold prices soared to near three-month highs on Friday, as investor demand for safe-haven assets surged amid growing uncertainty over U.S. trade policies and upcoming global central bank meetings. Spot gold jumped 0.8% to $2,774.49 per ounce, marking a gain of over 2% for the week, and briefly touched $2,777.10 earlier in the day, the highest level since October 31, 2024.
The increase in gold prices comes as the U.S. dollar weakened by more than 1% this week, poised for its largest weekly drop in two months. The dollar’s decline, driven by a lack of clarity on U.S. President Donald Trump’s trade plans and interest rate policies, has made gold more affordable for international buyers. As a result, demand for gold, often seen as a hedge against economic volatility, has spiked.
Jigar Trivedi, a senior analyst at Reliance Securities, attributed the dollar’s drop to Trump’s comments that contradicted market expectations. “The dollar slipped after Trump spoke against market expectations … This drop comes as he refrained from implementing aggressive tariffs following his inauguration,” Trivedi explained.
The market’s focus is now shifting to upcoming policy decisions from major central banks, including the U.S. Federal Reserve, European Central Bank (ECB), and the Bank of Japan. While the Fed is expected to hold rates steady, the ECB and Bank of Japan are anticipated to make key moves that could further influence market dynamics. Gold typically benefits from uncertainty and low interest rates, as it provides a safe store of value without the yield of interest-bearing assets.
Traders are now eyeing the potential for gold to reach an all-time high, with some analysts predicting that the precious metal could break the record of $2,790.15 per ounce set in October 2024. “There is a possibility of gold hitting an all-time high … and the outlook remains positive,” Trivedi said.
Read More: Gold Prices Surge to Over One-Month High on Weaker Yields and Soft Inflation Data
In addition to gold, other precious metals also saw gains. Spot silver rose 1.1% to $30.78 per ounce, palladium climbed 0.6% to $997, and platinum gained 1% to $952.75. All three metals were on track for weekly gains as well.
As market volatility continues to fuel demand for safe-haven assets, gold remains a key beneficiary, with the outlook for the metal staying positive in the face of global economic uncertainty.
