Gold soars to record highs amid tariff fears, geopolitical uncertainty and strong investor demand

04/02/2025 / By Kevin Hughes

Gold prices surged to an all-time high of over $3,100 per ounce, marking its strongest quarterly performance since 1986, driven by geopolitical tensions, inflation fears and central bank demand.
U.S. tariff threats and unpredictable trade policies have spooked investors, increasing safe-haven demand for gold as a hedge against economic instability.
Aggressive gold purchases by central banks (diversifying from the dollar) and strong inflows into gold ETFs (like SPDR Gold Shares) have supported the rally. Analysts predict prices could reach $3,300 by late 2025.
Major banks, including Goldman Sachs and Bank of America, have lifted price targets, with some predicting gold could hit $4,500 under extreme conditions due to sustained demand.
While silver and other metals underperform, gold’s rally is uniquely tied to macroeconomic risks. Despite overbought signals, analysts expect the uptrend to continue amid unresolved geopolitical and trade tensions.

Gold prices surged to unprecedented levels on Monday, March 31, surpassing $3,100 per ounce and marking one of the most remarkable quarterly performances in nearly four decades.

The precious metal’s relentless rally has been fueled by escalating geopolitical tensions, looming U.S. tariffs and robust demand from central banks and investors seeking a safe haven amid market turbulence. On Monday, March 31, spot gold hit an all-time high of $3,128.06 per ounce before settling at $3,116.94, while U.S. gold futures climbed to $3,150.30.

The metal has gained approximately 18 percent this year, following a 27 percent surge in 2024, positioning it for its strongest quarterly performance since 1986. Analysts attribute the rally to a confluence of factors, including fears of inflation triggered by potential U.S. tariffs, persistent geopolitical instability and aggressive central bank purchases.

“The ongoing uncertainty regarding tariffs has affected equity markets and brought another round of safe-haven buying into the gold market,” said David Meger, director of metals trading at High Ridge Futures.

“There are certain technical areas of resistance along the way that could cause a little profit-taking or pullback. But the ongoing bullish trend remains in place. The fundamental underpinnings remain in place.”

Market anxiety intensified as U.S. President Donald Trump announced reciprocal tariffs that would take effect on April 2, with automobile tariffs set to take effect the following day. Trump also threatened secondary tariffs of between 25 percent and 50 percent on buyers of Russian oil if he perceives Moscow as obstructing peace efforts in Ukraine.

These unpredictable policy moves have rattled investors, driving capital into gold as a hedge against economic uncertainty and potential inflationary pressures.

Central banks, ETFs fuel demand for the yellow metal

Central banks worldwide have been significant buyers of gold, diversifying reserves away from the U.S. dollar amid shifting monetary policies. The Federal Reserve’s anticipated interest rate cuts later this year have further bolstered gold’s appeal, as lower rates reduce the opportunity cost of holding non-yielding assets. (Related: Martin Armstrong joins with Mike Adams to discuss gold prices surge as central bank shortages spark panic.)

“Whilst buying gold may reduce central banks’ overall exposure to the dollar, we don’t think that the surge in central bank gold demand reflects a severe loss of confidence in the greenback,” analysts at Capital Economics said.

“Instead, the perception of gold itself as a safe haven is probably the key driver of central bank demand. In any case, we think official sector purchases will support gold prices to an above-consensus $3,300 per ounce by end-2025.”

Meanwhile, gold-backed exchange-traded funds (ETFs) have seen their largest weekly inflows since March 2022, with the SPDR Gold Shares ETF alone attracting $3.4 billion in February.

Wall Street raises price targets, while silver and other metals lag behind

Major financial institutions have revised their gold forecasts upward, with Goldman Sachs predicting prices could exceed 4,500 within 12 months under extreme conditions. Meanwhile, Bank of America strategists project gold reaching 3,500 in the next two years. They cited sustained demand from central banks, retail investors and China’s newly authorized insurance sector.

While gold dominates headlines, silver has struggled to keep pace, slipping 0.6 percent to $33.90 per ounce. Platinum and palladium posted modest gains, but analysts note that gold’s rally remains uniquely driven by macroeconomic and geopolitical factors rather than broader precious metals trends.

Despite gold’s overbought technical indicators – its Relative Strength Index stands at 77 – momentum remains strong. Analysts suggest that as long as trade tensions persist, inflation concerns linger and central banks maintain their buying spree, gold’s bullish trajectory could sustain.

With geopolitical risks from the Middle East to Europe still unresolved, the precious metal’s role as a financial safe haven appears more critical than ever. As investors brace for further market volatility, gold’s record-breaking run underscores its enduring appeal in an increasingly uncertain world.

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Watch Craig Hemke commenting on the potential reasons behind the recent surge in gold prices in this clip.

This video is from the Liberty and Finance channel on Brighteon.com.

Gold soars to record highs amid tariff fears, geopolitical uncertainty and strong investor demand

Central banks, ETFs fuel demand for the yellow metal

Wall Street raises price targets, while silver and other metals lag behind

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