Gold breaks through $5100 after Trump's muddled decisions. Will the rise continue?

Gold prices rose above $5100 per troy ounce for the first time amid rising geopolitical tensions and high demand for protective assets. Analysts attribute the rally in the precious metals market to the "crisis of confidence" caused by the latest foreign policy initiatives of US President Donald Trump's administration.

By 12:30 Astana time, the spot price of gold rose by 2.2% to $5094 per ounce. Earlier during the trades on January 26, the precious metal cost reached $5112. Gold futures also rose by 2.2% to $5128 per ounce.

Gold ended 2025 with its best performance in 46 years, thanks to sustained demand for safe-haven assets, lower U.S. interest rates (which made non-interest earning assets more attractive), heavy buying by central banks and record inflows into exchange-traded funds (ETFs). Since the beginning of 2026, gold prices have risen by more than 17%.

The latest catalyst for gold prices was "the crisis of confidence in the U.S. administration and U.S. assets that was triggered by some of the Trump administration's disorderly decisions last week," Reuters quoted Capital.com analyst Kyle Rodda as saying. "The Trump administration has triggered an irreversible breakdown in the established order of things, and that's why everyone is now running to gold as the only alternative," the expert added.

In the middle of last week, Trump unexpectedly refused to impose duties against European allies in the context of the Greenland dispute, but soon resumed confrontational rhetoric. Over the weekend, he promised to impose 100 percent duties against Canada if it struck a trade deal with China. Trump also threatened to impose 200 percent duties on French wines in an attempt to force French President Emmanuel Macron to join his "Peace Council" initiative.

The Trump administration's actions have alarmed markets, and for investors trying to navigate this uncertainty, gold's appeal as a "safe haven" has rarely been so high, Bloomberg writes. "Gold is the flip side of certainty," the agency quotes First Eagle Investment Management portfolio manager Max Belmont as saying. - It is insurance against unexpected inflation spikes, unforeseen market drawdowns and aggravation of geopolitical risks".

"Many of the current geopolitical uncertainties caused by Trump are unlikely to disappear anytime soon," predicts Vasu Menon, managing director of investment strategy at Oversea-Chinese Banking (quoted by Bloomberg). According to him, "gold may remain in play in the coming months and even years."

"We expect [gold] to rise further. Our current forecast suggests prices will peak around $5500 later this year," said Philip Newman, director of consultancy Metals Focus (quoted by Reuters). Periodic pullbacks are possible as investors begin to take profits, but any such correction would be seen as a buying opportunity on the downturn, Newman added.

Goldman Sachs recently raised its gold forecast for December 2026 from $4900 to $5400 per ounce. The investment bank argued that hedging global macroeconomic and political risks have become sustainable, effectively raising the starting point for gold prices this year, CNBC recalls.

This article was AI-translated and verified by a human editor