Gold prices have surged to record highs in 2025, driven by escalating trade tensions and economic uncertainty, making the precious metal a top choice for investors navigating volatile markets.
Bullion hit $3,235 per ounce on Friday, up more than 23% since January, reflecting its appeal as a hedge against instability. The rally follows President Donald Trump’s renewed push for tariffs, including a 145% levy on Chinese imports, which has heightened fears of a global trade war.
“Gold is considered a safe haven and loves uncertainty,” Stephen Mullowney, CEO and director at TRX Gold Corporation, said in an interview with MoneyWeek. “The world is changing, and long-standing norms from an international perspective are at risk.”
A weakening U.S. dollar has further fueled demand as investors flock to gold to preserve wealth during turbulent times. Central banks, particularly in China, India, and Russia, are also boosting gold’s value by increasing reserves to diversify away from dollar-based assets. China’s central bank has been adding to its gold holdings over the last five months, Reuters reported.
Meanwhile, gold exchange-traded funds (ETFs) have seen inflows. SPDR Gold Shares, the largest physically-backed gold ETF in the world, holds more than $93 billion in gold assets.
Unlike stocks, gold offers no dividends, but its price appreciation shines during crises. From 2000 to the mid-2020s, gold’s value grew ninefold, outpacing the S&P 500’s sixfold rise. However, analysts warn that volatility can lead to sharp pullbacks, as seen in profit-taking earlier this year.
With geopolitical risks and tariff uncertainties looming, gold’s allure remains strong. Investors are betting on its stability, even as forecasts predict prices could climb to $3,805 per ounce by next year and peak at $5,155 by 2030.