The gold price rally continued its historic run on Wednesday as gold surged past the $5,200 per ounce mark for the first time, driven by a sharp decline in the US dollar and growing investor uncertainty. Precious metals markets reacted strongly as the dollar slid to a four-year low, reinforcing gold’s role as a safe-haven asset during periods of economic stress.
Spot gold climbed 1.1 per cent to $5,243.58 per ounce, after briefly touching a new all-time high of $5,247.21 earlier in the session. Since the start of the year, gold prices have risen by more than 20 per cent, reflecting strong global demand. US gold futures for February delivery also jumped, gaining 3 per cent to trade near $5,237.70 per ounce.
Market analysts attribute this surge to a powerful inverse relationship between gold and the dollar. According to senior market analyst Kelvin Wong, the recent spike followed comments from President Donald Trump, who downplayed concerns over the weakening dollar and described its value as “great.” These remarks intensified expectations that US policymakers may tolerate or even favour a softer currency in the future, further boosting the gold price rally.
At the same time, confidence in the US economy has weakened. Consumer confidence fell to its lowest level in more than 11 years, fueled by concerns over a slowing labour market and persistent inflation pressures. Trump also signalled upcoming changes at the US central bank, suggesting that interest rates could fall under new leadership, a scenario that typically supports higher gold prices.
While the Federal Reserve is expected to hold interest rates steady at its current policy meeting, investors are already positioning for future easing. Analysts caution that near-term resistance could emerge around the $5,240 level, but long-term forecasts remain bullish. Deutsche Bank recently projected that gold could reach $6,000 per ounce in 2026, citing strong investment flows and increased diversification away from dollar-based assets.
Silver followed gold’s momentum, rising nearly per cent to $115.11 per ounce, after setting its own record earlier this week. The metal has already gained close to 60 per cent this year, underscoring the broader strength in precious metals.
