Gold surged to a record high of $3,055.96 per ounce on Thursday, fueled by expectations of interest rate cuts by the U.S. Federal Reserve and increasing geopolitical tensions. The precious metal has now recorded 16 all-time highs this year, as investors seek safe-haven assets amid economic uncertainty.
As of 0210 GMT, spot gold was trading 0.1% higher at $3,049.89 an ounce, while U.S. gold futures rose 0.6% to $3,058.40.
Fed Maintains Rates, Signals Possible Cuts
The Federal Reserve announced on Wednesday that it would keep its benchmark interest rate steady at 4.25%–4.50%, in line with market expectations. However, policymakers signaled that the central bank may cut rates twice by the end of 2025, a move that has boosted gold’s appeal.
"Gold is driven by a lot of uncertain market situations, geopolitical tensions, a weaker U.S. dollar, and expectations that interest rates will be cut later," said Dick Poon, general manager at Heraeus Metals Hong Kong Ltd.
A lower interest rate environment typically benefits non-yielding assets like gold, making it an attractive investment for traders seeking stability.
Market Uncertainty and Geopolitical Risks Drive Gold Rally
Gold’s surge comes at a time of heightened global uncertainty, with several factors influencing investor sentiment:
- Trade Tensions: President Donald Trump’s new import tariffs have led to economic slowdowns and inflation concerns, prompting investors to turn to gold as a hedge.
- Middle East Conflict: The Israeli military resumed ground operations in Gaza, with airstrikes reportedly killing at least 48 Palestinians.
- U.S. Dollar Weakness: A weaker dollar has supported gold prices, as a declining currency makes commodities like gold more attractive to global investors.
Gold’s Record-Breaking Run in 2025
Gold’s performance in 2025 has been exceptional, with the metal setting 16 record highs, including four surpassing the $3,000 milestone. The ongoing rally has drawn strong interest from institutional investors and hedge funds, as they look to gold for portfolio diversification.
Despite the sharp rise, analysts caution that a correction may be imminent.
"Given the very good performance in gold through Q1, I think a correction is not out of the question," said Nicholas Frappell, global head of institutional markets at ABC Refinery.
However, he added that gold’s pullbacks have been short-lived, with strong buying pressure at key levels.
Outlook: Resistance at $3,100?
Analysts predict that gold may face resistance around $3,090–$3,100, but broader trends remain supportive. The combination of economic uncertainty, lower interest rate expectations, and geopolitical risks suggests that gold could continue its strong performance in the months ahead.
Other Precious Metals
- Silver remained steady at $33.81 per ounce.
- Platinum edged up 0.1% to $994.05 per ounce.
- Palladium rose 0.1% to $957.42 per ounce.
With the Federal Reserve’s policy stance and global risks still unfolding, gold’s momentum remains strong—positioning it as a key asset for investors navigating uncertain economic conditions.
