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Gold prices soared to a historic $3,000 per ounce on Friday as escalating trade tensions under President Donald Trump fueled investor demand for safe-haven assets. The precious metal, long considered a hedge against economic uncertainty, has been on a record-breaking rally in 2025, gaining approximately 15% year-to-date.
Spot gold briefly touched $3,004 per ounce early Friday morning before stabilizing just below the milestone. Analysts attribute this surge to growing fears of an economic slowdown, rising geopolitical risks, and increasing protectionist policies.
The latest surge in gold prices follows Trump’s recent threat to impose a 200% tariff on European alcohol imports in response to the European Union’s newly implemented tariffs on U.S. goods. The EU introduced these measures after the U.S. imposed a 25% tariff on steel and aluminum imports earlier this week, intensifying trade tensions between the two economic powerhouses.
"Markets are fixated on the fallout of broad tariffs that the Trump administration has levied," the World Gold Council noted. Experts suggest that continued trade disputes and retaliatory tariffs could sustain high gold prices as investors seek protection from market volatility.
A major factor fueling gold’s rise is continued purchasing by central banks, particularly China’s. Last year, Poland’s central bank was the largest gold buyer, adding 90 metric tons to its reserves. Meanwhile, the United States remains the world’s largest holder of gold, with over 8,000 metric tons in reserves.
"Central banks are still buying and will probably continue to do so as geopolitical tensions and the economic climate push them to increase their allocation toward safe-haven assets," said Ewa Manthey, a commodities strategist at ING. With persistent demand from global financial institutions, gold prices are expected to remain elevated throughout 2025.
Some analysts speculate that Trump’s trade policies could eventually include tariffs on gold imports, which would have significant market implications. Manthey noted that such a move could further drive up prices while reshaping global trade flows.
"If tariffs on gold are applied, this would lead to higher and more volatile gold prices in the U.S. and a potential reshuffle of trade routes," she explained.
Currently, Mexico supplies about 30% of U.S. gold imports, while Canada accounts for around 15%. Any disruption to these supply chains could create further price volatility and impact global gold markets.
With ongoing geopolitical uncertainty, aggressive trade policies, and strong demand from central banks, analysts believe gold’s bullish run is far from over. If economic instability worsens or tariffs expand, gold could climb even higher, reinforcing its status as the ultimate safe-haven investment.
