Gold jumped to a further all-time high in USD as markets continue to react to the ever-changing horizon for global trade amid further mixed messaging from the US.
After wiping trillions from stock markets around the world with the promise of sweeping tariffs, President Trump stepped back from hitting other countries to focus on China, which faces a severe 145% levy on its goods. Retaliating with its own 125% tariff on American goods, stock markets continued to fall last week.
There has been further chaos this weekend, with the President stating that Chinese electronic goods would be exempt from the higher rate of tariffs. This has caused stock markets to bounce back, with technology companies in particular enjoying the benefits of these exemptions. There have already been suggestions however that the exemptions could be short-lived, and given the whipsawing policy changes in recent weeks, the current cheer in markets could be misplaced.
The uncertainty has left the US dollar index down 7.9% so far in 2025, and helped push gold to a new all-time high of $3,247.33 per ounce. The significant step down in the number of tariffs has raised hopes of fewer price increases, and markets are betting on at least two rate cuts to come in the year ahead from the Fed. If President Trump performs another U-turn however, and removes the exemptions or brings back tariffs on other countries, the dollar could strengthen somewhat as markets bet on higher inflation and interest rates.
With gold up more than 20% this year in USD however, gold is certainly seeing safe haven demand beyond just the dollar’s weakness. Markets remain incredibly uncertain about the year ahead, and communication from the White House changes at a daily pace.
In the UK, gold in GBP hit a new all-time high of £2,492 per ounce as the market closed for the weekend. The weaker dollar today has pulled that down to £2,436 at the time of writing, but £2,500 looks well within reach. In Euros gold hit a peak of €2,876.22, and €2,900 will be the next major milestone for the metal to beat.
Analysts have once again been forced to revise forecasts higher as gold continues to outperform expectations. Deutsche Bank have revised their 2026 average price to $3,700, while Goldman Sachs believes that figure could be hit before the end of this year.
Geopolitical and economic uncertainty continues to grow in the first months of Trump’s presidency, and are providing significant support to gold. The metal has already beaten many forecasts for 2025, and forecasts of $3,700 would have been unthinkable this time last year. Volatility is likely to remain high, offering buying opportunities along the way such as the dips seen last week, but the general trend looks to be heading one way in the near-term.
