Gold prices surged to an all-time high on Monday, breaching the $3,400 per ounce mark for the first time in history, as renewed pressure on the U.S. dollar, political instability, and global trade tensions drove investors toward traditional safe-haven assets.
The sharp rally comes amid a series of destabilizing developments, including President Donald Trump’s escalating rhetoric against the Federal Reserve, concerns over central bank independence, and a deteriorating trade outlook between the U.S. and China.
At one point during Monday’s trading session, spot gold surged 1.8% to $3,385.98 an ounce, with prices briefly touching even higher levels. As of 1:59 p.m. in Singapore, the metal was trading at $3,385.77, while the Bloomberg Dollar Spot Index dropped 0.9%, reaching its lowest point since early 2024.
Safe Haven Demand Accelerates
"Firing Powell not only undermines the principle of central-bank independence, but risks politicizing U.S. monetary policy in a way that markets will find unsettling," said Christopher Wong, strategist at Oversea-Chinese Banking Corp. "If the Fed’s credibility is called into question, that could erode confidence in the dollar and accelerate flows into havens, including gold."
Demand for gold has also been fueled by strong inflows into bullion-backed exchange-traded funds (ETFs), which have recorded their longest weekly streak of net inflows since 2022, now extending into the twelfth week. Meanwhile, central banks globally continue to add gold to their reserves, signaling persistent institutional interest in the metal amid a volatile geopolitical landscape.
Dubai Gold Prices Break New Records
The impact of gold’s international rally is being felt in the UAE. In Dubai, 24K gold was priced at Dh412 per gram, the highest ever recorded in the emirate. Other categories also surged:
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22K gold: Dh381.50 per gram
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21K gold: Dh365.75 per gram
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18K gold: Dh313.50 per gram
Gold prices in Dubai have increased by Dh17.75 per gram in just 7 days, prompting local consumers to shift strategies—opting to buy and hold rather than exchange older jewellery collections.
Trade Tensions, IMF Data Weigh on Sentiment
On the geopolitical front, China issued a warning that it would not accept any trade deals that compromise its national interests, further complicating the global economic landscape. The Ministry of Commerce reiterated that Beijing would retaliate against unfair trade actions, echoing growing concern about a deepening economic slowdown.
The International Monetary Fund (IMF) is set to release revised economic forecasts this week, which analysts expect will reflect weaker global growth projections, likely reinforcing bullish momentum in gold.
Goldman Sachs Eyes $4,000 Target
Bullish sentiment toward gold has been building throughout 2025. Goldman Sachs has raised its forecast for the precious metal, now projecting it could reach $4,000 per ounce by mid-2026, driven by continued demand, weakening dollar dynamics, and structural macroeconomic risks.
Meanwhile, other metals showed mixed performance. Silver reversed earlier losses to rise more than 1%, platinum also gained, while palladium experienced a modest decline.
