Gold prices surged to an all-time high of $2,946.85 per ounce, marking the ninth record peak this year. Driven by fears of a potential global trade war, triggered by U.S. President Donald Trump’s latest tariff threats, investors rushed to gold as a safe-haven asset. With bullion prices up 12% in 2024, market watchers now eye the $3,000 mark as the next milestone.
Ways to invest in Gold
- Spot market – Large buyers and institutional investors purchase gold through big banks. London, home to the London Bullion Market Association (LBMA), is the key hub, with other major markets in China, India, the Middle East, and the U.S.
- Futures market – Investors can trade gold via futures contracts, agreeing to buy or sell at a set price on a future date. COMEX in the U.S., Shanghai Futures Exchange, and Tokyo Commodity Exchange (TOCOM) dominate gold futures trading.
- Exchange-Traded Funds (ETFs) – These funds allow investment in gold without physical ownership. Physically backed gold ETFs saw a $3.4 billion net inflow in 2024, despite a slight drop in total holdings.
- Bars and coins – Retail buyers can purchase physical gold from metal dealers, either online or in stores, as an effective investment strategy.
Key drivers of gold prices
Investor Interest & Market Sentiment – Speculative demand and investment fund activity heavily influence gold prices.
Foreign Exchange Rates – Gold typically moves opposite to the U.S. dollar, as a weaker dollar makes gold more attractive for foreign buyers.
Monetary Policy & Political Tensions – Lower interest rates reduce the opportunity cost of holding gold, while trade tensions—such as Trump’s new auto and chip tariffs—increase demand for safe-haven assets.
Central Bank Reserves – Central banks continue buying gold due to economic uncertainty, with a record demand surge in 2024.
As uncertainty looms, gold remains a preferred hedge against inflation, currency volatility, and geopolitical risks.
