Gold prices surged to a fresh record on Monday, trading above $4,400 (£3,275) an ounce for the first time, driven by expectations of further US interest rate cuts and rising global uncertainty.
Analysts said investor demand for safe-haven assets has intensified amid geopolitical tensions, trade disputes linked to former President Donald Trump’s tariff policies, and growing expectations of monetary easing by the US Federal Reserve.
Gold began the year at around $2,600 an ounce but has since climbed more than 68%, marking its strongest annual increase since 1979, according to Adrian Ash, Director of Research at bullion marketplace BullionVault.
Mr Ash said 2025 has been shaped by “slow-burning trends” including interest rate expectations, wars, and trade tensions. “The precious metals market suggests President Trump has triggered something significant — and gold has gone crazy this year,” he said, citing trade wars, attacks on the Federal Reserve, and geopolitical instability.
After breaching the $4,400 mark, spot gold reached an intraday high of $4,426.66.
Lower interest rate expectations generally reduce returns on bonds, prompting investors to turn to commodities such as gold and silver for returns and portfolio diversification. Analysts currently expect the US to cut interest rates twice in 2026.
Central bank demand has also supported prices, with institutions worldwide increasing their gold reserves to counter economic volatility, reduce reliance on the US dollar, and diversify holdings. Goldman Sachs has predicted this trend will continue into 2026.
Anita Wright, a chartered financial planner at Ribble Wealth Management, said gold’s steady rise reflects its role as a hedge against inflation and economic uncertainty. “When confidence in financial assets and policy stability begins to wobble, gold tends to respond first,” she said.
A weaker US dollar has further boosted prices by making gold cheaper for overseas buyers.
Other precious metals also recorded gains, with silver hitting a record $69.44 an ounce. Silver is up 138% year-to-date, while platinum reached a 17-year high, outperforming gold due to strong demand and supply constraints. Unlike gold, these metals are widely used in industrial manufacturing, which has further fuelled demand.
Meanwhile, oil prices rose after the US imposed a “blockade” on sanctioned oil tankers entering and leaving Venezuela. Brent crude climbed $1.31 to $61.78 a barrel, while US crude rose $1.25 to $57.77. Despite the increase, both benchmarks are expected to end 2025 lower than where they began the year.
Source: BBC
