The price of gold has soared to a record-breaking $3,004.86 per ounce, marking a 14% increase since the beginning of 2025. The surge comes as investors flock to the precious metal amid mounting economic uncertainty driven by a global trade war.
The escalating tensions, particularly between the US and its major trading partners, have rattled financial markets. US President Donald Trump recently threatened a 200% tariff on alcohol imports from the European Union in response to the bloc’s proposed 50% tax on US whiskey. Meanwhile, Chinese imports into the US are now facing tariffs of at least 20%, fueling fears of inflation and economic instability.
“Markets hate uncertainty,” said Victoria Hasler, head of fund research at Hargreaves Lansdown. “With Trump’s tariffs, ongoing tensions in the Middle East, and geopolitical concerns over Russia and Ukraine, gold is becoming an increasingly attractive asset.”
Beyond investor demand, central banks are also stockpiling gold, further driving up prices. Last year alone, global central banks added over 1,000 tonnes of gold to their reserves, continuing a three-year trend. Analysts suggest this move is partly driven by a desire to reduce reliance on the US dollar.
Russ Mould, investment director at AJ Bell, noted that gold’s rise has been steady since dipping below $1,200 per ounce in 2018. He pointed to a combination of factors, including pandemic-induced economic shifts, government deficits, and inflation concerns, as key drivers of the metal’s renewed appeal.
With geopolitical instability showing no signs of easing, analysts predict that gold will remain a sought-after asset in the months ahead.
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