Gold has made history, reaching the $3,000 per ounce mark for the first time, as investors flock to the precious metal seeking refuge from growing economic uncertainty sparked by Donald Trump’s trade policies.
During morning trading on Friday, spot gold hit a new record of $3,004.71 per ounce, before retracting slightly to around $2,983.35 by 10:40 a.m. ET. Gold futures in New York came very close to the milestone, touching a high of $3,017 per ounce earlier in the day.
Gold Shines as a Safe-Haven Asset
The new record underscores gold’s age-old role as a reliable store of value in times of economic turmoil and market fear. It follows a pattern established over the last few decades: the price surpassed $1,000 per ounce following the 2008 financial crisis, broke through the $2,000 barrier during the Covid-19 pandemic, and now has crossed $3,000 amid an ongoing and unprecedented trade war.
In the last 25 years, gold has risen tenfold, vastly outperforming the S&P 500 index, which quadrupled during the same period.
“Gold is an asset that can preserve value through the greatest variety of macroeconomic dislocations,” said Thomas Kertsos, co-portfolio manager at First Eagle Investment Management, in a statement to Bloomberg. “Despite volatility, gold has always managed to mean-revert and maintain its purchasing power, all while providing significant liquidity.”
A Faster Rise Than Expected
The surge to $3,000 came far quicker than many analysts anticipated. As the price moved past the key thresholds of $2,000 and $2,500 over the last year, forecasts for gold kept rising. Now, some analysts have set their sights on an even higher target.
Bank of America analysts, led by Michael Widmer, have suggested that gold could hit $3,500 per ounce if investment demand rises by 10%. While a significant leap, they believe it is not out of reach. Similarly, Goldman Sachs has raised its gold price forecast to $3,100 by the end of 2025.
Geopolitical and Policy Drivers Behind the Surge
The unpredictability of the US government under Donald Trump has been a key factor in driving gold’s upward trajectory this year. Despite higher interest rates and a robust US dollar, which would typically deter investment in gold, the geopolitical instability and economic uncertainty surrounding Trump’s trade policies have outweighed these factors. So far in 2025, gold has surged by 14%.
“Gold prices have surged to a record high, fuelled by heightened tariff uncertainty and expectations of monetary easing by the US Federal Reserve,” noted analysts from Red Cloud Securities.
The “fear of missing out” (FOMO) also appears to have played a role, as many investors who missed out on earlier price surges are now scrambling to enter the market.
“A lot of investors missed the opportunity when gold crossed $2,400, $2,500, $2,600,” said Philip Newman, founder of consultancy Metals Focus. “They probably thought there would be a correction, but it never happened. Now, there’s a sense that they don’t want to miss out on $3,000.”
Gold’s Inflation-Adjusted Price Still Behind 1980 Peak
Despite hitting new record highs, gold remains well below its inflation-adjusted peak of $3,800 per ounce, set in 1980 during a period of weak economic growth, runaway inflation, and escalating geopolitical tensions. Some analysts believe similar forces could continue to push gold into new territory in 2025.
Central Banks Fueling the Rally
A significant driver of gold’s recent rally has been the buying activity of global central banks. In the wake of Russia’s invasion of Ukraine in 2022, central banks have sought to reduce their reliance on the US dollar by increasing their gold reserves. According to the World Gold Council, central bank purchases have doubled from approximately 500 tonnes per year to over 1,000 tonnes in recent years.
Notably, China, the US’s main economic rival, has significantly ramped up its gold purchases, increasing its reserves for four consecutive months, even as gold prices remain at historically high levels.
As the price of gold continues to rise, many are watching closely to see whether it can maintain its upward momentum, with some analysts speculating that the metal’s role as a safe-haven investment could see it break further records throughout 2025.