Gold Breaks $5,000 an Ounce for First Time
By Praisebell Rosemond Larbi
Gold prices have surged past $5,000 an ounce for the first time in history, extending a historic rally that saw the precious metal gain more than 60 per cent in 2025, as investors seek refuge amid mounting geopolitical and financial uncertainty.
The latest milestone comes against the backdrop of rising tensions between the United States and NATO over Greenland, alongside renewed concerns about global trade disruptions. Market anxiety has also been fuelled by US President Donald Trump’s protectionist trade stance, including a recent threat to impose a 100 per cent tariff on Canada should it finalise a trade agreement with China.
Gold, long regarded as a safe-haven asset, tends to attract investors during periods of uncertainty, inflationary pressure, and market volatility. The rally has not been limited to gold alone. Silver climbed above $100 an ounce for the first time on Friday, building on an almost 150 per cent surge in 2025, highlighting broad-based demand across the precious metals complex.
Analysts point to several factors driving the sustained rise in gold prices. These include persistent inflation in major economies, a weaker US dollar, strong buying by central banks, and growing expectations that the US Federal Reserve will cut interest rates at least twice this year. Lower interest rates typically reduce returns on bonds and other fixed-income assets, making non-yielding assets such as gold more attractive.
Geopolitical risks have also played a significant role. Ongoing conflicts in Ukraine and Gaza, along with Washington’s seizure of Venezuelan President Nicolás Maduro, have heightened global risk aversion, pushing investors toward assets perceived as stores of value.
Another key attraction of gold is its scarcity. According to the World Gold Council, only about 216,265 tonnes of gold have ever been mined, an amount that would fill just three to four Olympic-sized swimming pools. While mining output increased significantly after 1950 due to technological advances, supply growth is expected to plateau in the coming years. The US Geological Survey estimates that around 64,000 tonnes of gold remain in underground reserves.
“When you own gold, it’s not attached to the debt of somebody else like a bond or the performance of a company like an equity,” said Nicholas Frappell, Global Head of Institutional Markets at ABC Refinery. “It’s a very good diversifier in a highly uncertain world.”
Gold recorded its strongest annual performance since 1979 in 2025, as concerns over US trade policy, geopolitical risks, and fears of overvaluation in artificial intelligence-related stocks repeatedly pushed prices to new highs.
Central banks have also been major buyers. Last year alone, they added hundreds of tonnes of bullion to their reserves, reflecting what analysts describe as a gradual shift away from reliance on the US dollar.
“There’s a very clear move away from the dollar, and that’s benefiting gold immensely,” said Nikos Kavlis of Metals Focus.
While the rally has continued into early 2026, analysts caution that gold remains sensitive to news flow. Any unexpected easing of geopolitical tensions or stronger-than-expected global growth could temper prices. Still, with uncertainty lingering, gold’s record-breaking run underscores its enduring appeal as both an investment and a store of value.
