Gold surged past $5,500 per ounce on Thursday, extending its record-breaking rally as a weaker US dollar and mounting economic and geopolitical uncertainties boosted demand for safe-haven assets.
Momentum accelerated after President Donald Trump downplayed the dollar’s slide to four-year lows, signaling a tolerance for currency weakness even as his administration maintained tariff threats and renewed criticism of the Federal Reserve’s independence. The remarks reinforced investor concerns over US policy credibility and long-term currency stability.
Meanwhile, the Federal Reserve left interest rates unchanged, as widely expected, pointing to resilient economic activity and early signs of stabilization in the labor market.
However, policymakers acknowledged that inflation remains elevated and the outlook uncertain. Notably, two Fed officials dissented in favor of an immediate rate cut, keeping expectations alive for monetary easing later in the year.
Geopolitical tensions added another layer of support for gold prices following US warnings of potential military action against Iran, alongside statements that a large US naval presence in the region is prepared to respond “with speed and violence, if necessary.” The escalation heightened risk aversion across global markets.
Further underpinning gold’s strength are growing fiscal concerns in major economies, sustained central-bank purchases, and continued inflows into gold-backed exchange-traded funds (ETFs), signaling strong institutional and sovereign demand.
With policy uncertainty, geopolitical risks, and currency pressures all converging, gold’s rally appears firmly anchored in both macroeconomic and strategic considerations.
