Gold increases as investors look for safety due to uncertainty in US policies.

Gold Prices Reach New High Amid U.S. Policy Uncertainty

On January 27, gold prices saw a notable increase, remaining near the $5,100 per ounce mark which it first surpassed the day before. This spike in prices is largely attributed to investors seeking safety in gold amidst the uncertainty surrounding U.S. President Donald Trump’s policy decisions.

At 10:12 AM GMT, spot gold climbed by 1.6%, reaching $5,092.09 an ounce. The previous day, it had achieved an all-time high of $5,110.50.

Also, U.S. gold futures for February gained slightly, rising 0.1% to $5,089 an ounce.

According to OANDA Market Pulse analyst Zain Vawda, the ongoing discussions regarding tariffs between President Trump and his administration, along with heightened worries over military actions in Iran, are likely to keep demand for safe havens like gold robust.

This year, gold prices have surged approximately 18%, continuing from last year’s gains, mainly driven by demand for safe assets amid geopolitical tensions, expectations of U.S. interest rate cuts, and strong buying from central banks.

In terms of trade relations, President Trump announced a plan on Monday to raise tariffs on automobiles and other goods imported from South Korea. Meanwhile, after renewing his warnings towards Iran, a U.S. official indicated that the U.S. would be open to communications with Iran if they desired.

Analysts from Deutsche Bank and Société Générale predict that gold could rise to $6,000 an ounce by the end of the year, suggesting that further increases are possible.

Attention is now focused on the Federal Reserve’s policy meeting starting Tuesday, where it is expected that interest rates will remain steady. Investors are also waiting for updates regarding Chairman Jerome Powell’s succession.

On the silver front, spot silver experienced a sharp increase of 8.4%, reaching $112.57 an ounce after its peak of $117.69 on Monday, signifying over a 50% rise this year.

BMI, a division of Fitch Solutions, commented that they expect silver prices to decrease in the coming months as supply issues lessen and industrial demand peaks, particularly with anticipated slowdowns in China’s economy.