Gold Surges to Record Highs Amid Trade War Concerns and “De-Dollarization” Trend
Gold prices are hitting record levels, fueled by a weakening US dollar, escalating trade war anxieties, and a growing sense of market unease. The precious metal has become a favored “safe haven” asset as investors seek alternatives to the dollar and navigate concerns about potential risks in bond markets.
markets haven’t been severely impacted by the increase in US tariffs this year to levels not seen sence the 1930s,but the US dollar has borne the brunt of trade war worries.M&G fund manager Eva Sun-Wai recently told M&G’s Bond watching forum that this has contributed to a “broader de-dollarization trend, which has caused angst in markets.”
Sun-Wai added that this trend is a “big reason why gold, for example, has become the safe haven choice,” as investors shy away from the dollar and the risks associated with interest rate fluctuations. The greenback is down more than 9% so far in 2025, driven by concerns regarding Federal Reserve independence and ongoing trade tensions – a decline that mechanically boosts gold’s value when priced in dollar terms.
Should Investors Buy Gold?
despite the inherent risks of investing in any volatile market – particularly given concerns that asset prices might generally have risen too high – some analysts are optimistic about gold’s potential. Deutsche Bank recently raised its gold price forecast for 2026 by $300, to $4,000 per ounce.
Investors have several avenues for acquiring gold. Physical gold can be purchased from sources like the Royal Mint, which sells coins and bars. Bulk retailers like Costco even stock gold bars, which have frequently sold out, perhaps due to the metal’s popularity with doomsday preppers. Though, Jemma Slingo of Fidelity International cautions that “such investments come with extra costs and complications, however, like insurance and storage.”
Alternatively, investors can consider gold exchange-traded funds (ETFs), which track the price of gold, or shares in gold mining companies, such as Fresnillo, whose share price has risen 250% this year.
Analysts warn of the possibility of a price correction, particularly if inflation subsides or geopolitical tensions ease.
