Gold prices surged to a new record on Monday, rising about 2% to $5,090 per ounce, as investors sought safety amid escalating trade tensions, geopolitical risks and caution ahead of a closely watched U.S. Federal Reserve meeting.
Safe-haven demand strengthened after Canadian Prime Minister Mark Carney said Ottawa has no plans to pursue a free trade agreement with China, following renewed pressure from Washington.
His remarks came a day after U.S. President Donald Trump threatened to impose a 100% tariff on Canadian goods should Canada move forward with a trade deal with Beijing, unsettling markets already sensitive to protectionist signals.
Geopolitical uncertainty added to risk-averse sentiment. Relations between the United States and Europe have been strained by disagreements over Greenland, while ongoing tensions in the Middle East continued to weigh on investor confidence.
In the United States, concerns over a potential government shutdown resurfaced after Senate Democrats signaled opposition to a major funding bill, further clouding the outlook.
Market attention is now turning to the Federal Reserve’s policy meeting later this week, where the central bank is widely expected to keep interest rates unchanged. Lower expectations for near-term rate hikes have supported gold, which typically benefits from a low-rate environment.
After ending 2025 with strong gains, gold has already advanced by about 17% so far this year, reinforcing its status as a preferred hedge against political uncertainty, market volatility and global economic risk.
