Gold surged to an all-time high of $3,500 per ounce on Tuesday, extending a rally fueled by investor flight to safety amid mounting concerns over global inflation, currency volatility, and slowing economic growth.
The precious metal’s unprecedented surge comes as markets brace for a confluence of economic headwinds, including persistent inflationary pressures, geopolitical tensions, and fears of prolonged stagnation in major economies. Analysts say the move reflects investors’ growing preference for traditional safe-haven assets in the face of rising uncertainty.
Traders point to central banks increasing gold reserves and a weakening U.S. dollar as major drivers of the rally. “Gold is benefiting from a perfect storm of macroeconomic factors,” said one commodities strategist, noting that global demand has significantly outpaced supply in recent months.
The rally has also put renewed pressure on equity markets, which saw a wave of sell-offs as portfolio managers rebalanced toward safer assets. Meanwhile, inflation-sensitive sectors such as energy and food continue to see heightened volatility, further boosting gold’s appeal.
With $3,500 now breached, market watchers are split on whether the momentum will sustain or trigger a correction. Some analysts warn that steep gains could encourage profit-taking, while others believe geopolitical risks and sticky inflation will keep gold prices elevated.
