As trade tensions escalate between the United States and major trading partners, gold prices have surged past $3,000 per troy ounce (approximately €90.77 per gram).
The record price--$3,003.49 per ounce to be exact--was briefly hit on 14 March 2025 before dipping back below the $3,000 mark, with trading still ongoing at the time of writing. The precious metal has benefitted from growing concerns over global trade tensions, inflationary pressures and the potential for slower economic growth. As uncertainties mount, investors are increasingly flocking to gold, which continues to be seen as a secure store of value in times of economic turbulence.
A major catalyst for gold’s recent rise is the escalating trade war between the US and key global trading partners. On 13 March 2025, US president Donald Trump threatened a 200% tariff on French wine, champagne and other alcoholic beverages, the already fraught situation between the US and the European Union. This came just days after the US imposed 25% tariffs on steel and aluminium imports from various countries, including Canada, prompting swift retaliation from both the EU and Canada.
John Reade, senior market strategist at World Gold Council, stated: “Gold hitting $3,000 is a significant milestone and reinforces the asset’s safe haven role in times of uncertainty. From $1,000 during the financial crisis to $2,000 amid the pandemic, gold has proven to perform well in risk-off environments as well as delivering returns in line with most other asset classes since 1971.”
The volatility in trade relations is only one part of the broader picture that is buoying gold prices. In addition to the geopolitical tensions, gold has become increasingly attractive as an inflation hedge, especially in the face of economic uncertainty. Reade added, “Central banks have been net buyers for the past fifteen years, but purchases have surged in the past three years, with over 1,000 tons bought each year since 2022, reaching 1,045 tons in 2024. We believe geopolitical factors have driven this increase--including de-dollarisation, sanctions and inflation concerns. As global fragmentation continues, central bank buying will remain a strong pillar of demand and shape the market’s long-term dynamics.”
Gold has already been one of the best-performing major commodities of the year, with a more than 14% year-to-date increase. It has consistently hit , supported not only by trade tensions and central bank purchases but also by significant inflows into exchange-traded funds (ETFs). So far this year, total known gold ETF holdings have grown by approximately 3.5m ounces, reaching nearly 86.4m ounces. This growing appetite for gold in both physical and ETF forms reflects the increasing demand for safe-haven assets as global uncertainties continue to rise.
Looking ahead, the outlook for gold remains positive, analysts at ING stated. The potential for further escalation in trade tensions and additional central bank purchases are expected to provide further support for prices.