Gold prices soared over 2% on Monday, reaching $3,353.69 per ounce, as investors flocked to the safe-haven asset amid escalating global uncertainties, trade tensions, and geopolitical instability.
Spot Gold Spikes on Global Uncertainty
As of 9:57 a.m. Nigerian time, the price of spot gold jumped from $3,287.93 to $3,353.69 per ounce, reflecting investor anxiety triggered by renewed U.S.-China trade tensions and intensifying conflict in Eastern Europe. The rally underscores gold’s role as a reliable hedge in times of crisis.
U.S.-China Trade War Fears Resurface
New threats from U.S. President Donald Trump to raise tariffs on foreign steel and aluminium imports to 50% reignited fears of a renewed trade war with China. Accusations from both nations over breaches in their trade commitments have unsettled global markets. In response, Canada has threatened retaliatory tariffs, further complicating the trade landscape.
These developments have sent investors scrambling for gold, widely considered a safe-haven asset during times of financial and political turmoil.
Weakening U.S. Dollar Boosts Gold Demand
The U.S. dollar fell early Monday, making gold cheaper for foreign investors. This added to the global appeal of the yellow metal, especially among investors operating in weaker currencies. A depreciating dollar typically enhances gold’s purchasing power internationally, contributing to the current demand spike.
Russia-Ukraine Conflict Escalates
According to Bloomberg, Ukraine launched drone strikes deep into Russian territory on Sunday, hitting military targets as far as Siberia. Russia responded with one of its most intense missile attacks on Kyiv, escalating tensions just days before scheduled peace talks.
The renewed violence has driven further safe-haven buying of gold as investors seek protection from the unpredictability of global conflict.
Gold’s 2025 Performance and Investor Sentiment
Gold continues to shine in 2025, with year-to-date gains exceeding 25%, making it one of the best-performing commodities this year. Goldman Sachs recently reinforced its bullish stance on gold, naming it a “core inflation hedge” and a key part of diversified investment portfolios.
Even with occasional pullbacks, such as last week’s dip to $3,273.19 per ounce, gold remains resilient. The decline was linked to a U.S. federal court ruling limiting Trump’s tariff authority, which temporarily buoyed riskier assets. However, the White House’s immediate appeal of the decision restored market uncertainty and reignited the gold rally.
Outlook: Gold to Remain in Focus as Volatility Persists
As global economic and political tensions persist, analysts project that gold will continue to play a critical role in investor portfolios. Although temporary corrections may occur due to profit-taking or shifts in sentiment, the long-term fundamentals for gold remain robust.
Key Drivers of Gold Prices in 2025:
- Rising geopolitical instability (e.g., Russia-Ukraine war)
- Renewed U.S.-China trade conflict
- A weakening U.S. dollar
- Investor demand for safe-haven assets
- Inflation and interest rate uncertainty
Gold Positioned as a Strategic Safe-Haven Asset
In a world fraught with economic disruption, global conflict, and unpredictable trade policies, gold stands out as a resilient and strategic investment. Experts advise maintaining diversified exposure to precious metals, especially in an environment where market stability remains elusive.
