Gold prices have surged to an unprecedented high, exceeding $5000 per ounce for the first time, reaching a peak of just over $5020 yesterday before experiencing a slight drop today. This remarkable increase comes after a steady rise in gold values over the past few months, with prices about 20 per cent higher compared to the same period last year.
The escalating gold prices can be attributed to recent market volatility linked to US President Donald Trump’s economic policies, which include a broad expansion of tariffs. In light of these uncertainties, investors globally are gravitating towards gold, recognising it as a crucial safe-haven asset that provides a hedge against inflation and geopolitical instability. Sean Hoey, managing director of IBV International Vaults London, noted the “unprecedented demand” for secure gold storage amidst this climate.
The potential impact of Trump’s policies could extend to billions of dollars in Australian exports, including commodities like beef and sheep, pharmaceuticals, and media. An updated list of US trade grievances suggests that these sectors may face repercussions. Additionally, speculation is growing that Trump might abandon the “reciprocal tariffs” strategy—whereby the US would impose fees equivalent to those other countries charge for imported goods—in favour of broader, blanket tariffs.
As investors and market analysts closely monitor the situation, the shifts in trade policy and economic stability will likely continue to influence gold’s market trajectory and demand.