Gold Price Hits $5,000 for First Time as Safe-Haven Demand Surges
The gold price surged above $5,000 an ounce for the first time ever, marking a historic milestone as investors rushed toward safe-haven assets amid mounting geopolitical and financial uncertainty.
The rally extends gold’s remarkable run in 2025, during which the precious metal has gained more than 60 percent. Market volatility has been fueled by rising tensions between the United States and NATO over Greenland, along with renewed concerns surrounding US trade policy.
US President Donald Trump has further unsettled markets by threatening to impose a 100 percent tariff on Canada should it move forward with a trade agreement with China. The uncertainty has boosted demand for gold and other precious metals traditionally viewed as stores of value during turbulent times.
Silver also joined the rally, topping $100 an ounce for the first time on Friday, building on its nearly 150 percent surge last year.
Analysts say multiple factors are driving the surge in the gold price, including persistent inflation, a weakening US dollar, increased buying by central banks, and expectations that the US Federal Reserve will cut interest rates again this year.
Ongoing conflicts in Ukraine and Gaza, as well as geopolitical developments involving Venezuela, have also contributed to heightened investor anxiety.
Gold’s appeal is further strengthened by its limited supply. According to the World Gold Council, only around 216,265 tonnes of gold have ever been mined globally. The US Geological Survey estimates that approximately 64,000 tonnes remain underground, though future production is expected to slow.
“When you own gold, it’s not tied to someone else’s debt like bonds or equities,” said Nicholas Frappell, global head of institutional markets at ABC Refinery. “It’s a strong diversifier in a very uncertain world.”
The metal recorded its strongest annual gain since 1979 last year, as concerns over trade tensions and fears of overvalued technology stocks pushed investors toward safer assets.
Lower interest rate expectations have also supported gold prices, as reduced bond yields make non-interest-bearing assets more attractive.
Beyond investment demand, cultural factors continue to play a role. In countries such as India and China, gold purchases traditionally rise during festivals, weddings, and major celebrations. Indian households alone are estimated to hold gold worth $3.8 trillion, nearly 89 percent of the country’s GDP, according to Morgan Stanley.
While the rally shows no immediate signs of slowing, analysts caution that gold markets remain highly sensitive to global developments, and any unexpected positive geopolitical news could temper prices.
