Gold prices have reached a historic milestone, crossing the $5,000 per ounce mark for the first time, as investors rushed toward safe-haven assets amid growing geopolitical and trade tensions.
On Monday, spot gold rose by nearly 1.8% to $5,071.96 per ounce, after touching an intraday high of $5,085.50. Meanwhile, US gold futures for February delivery also climbed to $5,068.70, reflecting strong demand across global markets.
Strong Performance Throughout 2025
The precious metal has delivered exceptional returns in 2025, gaining nearly 64% over the year, supported by continued investor confidence. Prices are already up more than 17% in the current year alone, making gold one of the best-performing assets globally.
Analysts attribute this surge to several key factors, including expectations of US interest rate cuts, heavy buying by central banks, and record inflows into gold-backed exchange-traded funds (ETFs). China’s central bank has reportedly increased its gold reserves for the fourteenth consecutive month, adding further momentum to prices.
Geopolitical and Trade Risks Shake Markets
Global financial markets have been unsettled by escalating geopolitical and trade disputes. Recent statements by US President Donald Trump regarding potential tariffs on Canada and European countries have intensified uncertainty among investors.
Threats of imposing 100% tariffs on Canada and 200% duties on French wine and champagne have raised concerns about a renewed trade war, pushing investors toward safer assets like gold.
Weaker Dollar Boosts Gold Demand
A strengthening Japanese yen has pressured the US dollar, making gold cheaper for buyers using other currencies. This currency shift has further strengthened demand for the metal, especially ahead of the upcoming Federal Reserve policy meeting.
Market experts believe that continued dollar weakness could support gold prices in the coming months.
Analysts Predict Further Upside
According to Philip Newman, Director at Metals Focus, gold prices could rise even further and potentially reach $5,500 later this year. While short-term corrections are possible due to profit-taking, analysts expect buying interest to remain strong.
Other Precious Metals Also Rally
The rally extended beyond gold, with other precious metals posting strong gains:
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Silver jumped over 4.5% to $107.65 per ounce
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Platinum rose more than 3% to $2,857.41
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Palladium gained over 3% to $2,074.40
Silver recently crossed the $100 level for the first time, supported by tight supplies and rising retail investor participation.
Impact on Pakistani Investors
For Pakistani investors, rising global gold prices may lead to higher domestic rates, affecting jewelry buyers, traders, and savers. Analysts advise closely monitoring currency movements and global economic developments before making major investment decisions.
