Gold prices surged to an unprecedented record above US$5,000 an ounce on Monday (Jan 26), extending a historic rally as investors flocked to the safe-haven asset amid intensifying geopolitical and economic uncertainty.
Spot gold rose 0.94 per cent to US$5,029.62 per ounce by 2321 GMT, while US gold futures for February delivery gained 1.02 per cent to US$5,029.70. The milestone marked another dramatic leap in a rally that has gathered pace since the start of the year, driven by a combination of geopolitical risks, trade tensions and expectations of looser monetary policy.
Independent analyst Ross Norman said gold’s upward momentum is far from over. “Our forecast for the year is that gold will see a high of US$6,400 an ounce with an average of US$5,375,” he said, citing strong investor demand and persistent global instability.
Escalating friction between the United States and NATO over Greenland has added fresh fuel to the rally, reinforcing expectations of prolonged financial and geopolitical uncertainty. Meanwhile, efforts to de-escalate the war in Ukraine remain stalled. Ukraine and Russia concluded a second day of US-brokered talks in Abu Dhabi on Saturday without reaching an agreement, though further discussions are expected next weekend. The talks ended as overnight Russian airstrikes knocked out power for more than a million Ukrainians during subzero winter conditions, underlining the fragile security environment.
Trade tensions have also weighed heavily on market sentiment. US President Donald Trump said on Saturday he would impose a 100 per cent tariff on Canada if it proceeds with a trade deal with China, warning Canadian Prime Minister Mark Carney that such a move would endanger the country’s economic interests.
Gold soared 64 per cent in 2025, supported by easing US monetary policy, robust central bank demand and record inflows into exchange-traded funds. China extended its gold-buying spree for a fourteenth consecutive month in December, highlighting sustained official-sector demand.
Robin Tsui, Asia Pacific gold strategist at State Street Investment Management, said gold’s recent strength builds on last year’s rally, which was driven largely by structural factors such as expectations of interest rate cuts. He noted that the latest gains are mainly the result of rising geopolitical risks, particularly uncertainty surrounding US trade policies under Trump.
“We can see there’s a lot of both strategic and tactical money that’s going to gold,” Tsui said. “All these tariffs and tensions have pushed more worries into the global economy. Gold has benefited because historically it has been a good hedge against downturns in currencies and risky assets.”
Other precious metals were mixed. Spot silver rose 1.85 per cent to US$104.85 per ounce, after climbing above US$100 for the first time on Friday. Platinum slipped 0.21 per cent to US$2,762.25, while palladium edged up 0.22 per cent to US$2,014.50. Silver’s rally has been bolstered by retail investor interest and tight physical market conditions following a 147 per cent surge last year.
