Gold Hits Record High: What Is Causing It & What It Means For You
There are three major reasons behind the surge in gold prices.
Gold surged to a historic high of USD3,500 per ounce (RM15,400) on 22 April, marking a major milestone in global markets and raising questions about its role as a safe haven asset
Image via New Straits Times / Bernama
Once seen primarily as a traditional store of value, gold is now front and centre in investor conversations around the world.
The current rally isn't just about price — it’s about global uncertainty and the search for financial security.
So, what's driving the surge in gold prices?
Several global factors have driven demand for gold in recent weeks:
1. Political tension in the US
Image via New Straits Times / AFP
Reports that US President Trump is considering removing Federal Reserve Chairman Jerome Powell have raised concerns about central bank independence.
Trump has been attacking Powell, insisting that the central bank chief should reduce interest rates to spur the economy.
"I believe he’s making a mistake by not lowering interest rates, and I think, as well as we’re doing, we could do much better," Trump said today, according to CNN.
Trump's actions have shaken confidence in the US dollar, pushing investors towards gold.
2. Renewed US-China trade tensions
Talks between the two economic giants have reportedly stalled, with discussions around new tariffs on the table.
Trump had previously increased tariffs on Chinese goods shipped to the US by 145%.
The US President has since backtracked and said that the US is open to reducing the tariffs, provided China comes to the table to negotiate.
Investors are turning to gold as a hedge against potential market volatility.
3. Declining faith in the US dollar
Image via New Straits Times / Reuters
There's a growing movement away from the greenback as the world's reserve currency.
With inflation fears and concerns over fiat currencies, gold is being viewed as a more reliable store of value.
Could it go even higher?
According to financial advisory firm deVere Group, the gold rally could continue
Image via deVere Group Channel / YouTube
The firm projects that gold could reach USD5,000 per ounce (RM22,000) as investors seek shelter from inflation, political uncertainty, and currency instability.
"The US and China are now competing not only economically, but ideologically. This is not a short-term cycle — it's a long-term realignment. And it's driving a seismic shift in portfolio strategy," eVere Group CEO Nigel Green said, according to Finance Feeds.
Does this mean now is a good time to buy gold?
Despite the optimism, experts warn of short-term volatility
After touching USD3,500, gold prices slipped slightly to USD3,336 (about RM14,600) due to profit-taking and a brief rebound in the US dollar.
Technical indicators suggest gold may be overbought for now, meaning a price correction could be around the corner.
Analysts and experts advise new investors to watch for a potential price dip before jumping in. It's also worth noting that gold doesn't generate income like stocks or bonds — its strength lies in preserving value during uncertain times.
For those already holding gold, this may be an opportune time to review your portfolio — whether to take some profit or stay in for the long term.
Don't miss out! Here are some more trending stories on SAYS:
Leave a comment