Recent geopolitical risks and a weaker US dollar have propelled gold prices to a historic breakthrough above $5,000 per ounce, reaching a new high of $5,095 per ounce on Monday, with a year-to-date increase exceeding 16%.
There remains sufficient geopolitical uncertainty to keep gold firmly in the spotlight for investors as a defensive asset. Market expectations that President Trump might nominate a dovish new Federal Reserve Chair have emerged; should this lead to interest rate cuts, it would benefit gold from a yield perspective. This combines geopolitical risk with monetary policy expectations, jointly reinforcing the core logic of gold as a safe-haven asset.
In summary, these are the driving forces behind gold's record-breaking performance amidst turbulence. With the dual impact of tense geopolitical situations, such as fluctuating EU-US trade relations, and potential monetary easing, gold's defensive value has become increasingly prominent. This also aligns with Goldman Sachs' bullish outlook, which has raised its 2026 gold price forecast to $5,400.
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