empty
06.02.2025 11:41 AM
Gold Surges: Are New All-Time Highs Within Reach?

Gold prices have skyrocketed to record highs as fears over potential U.S. tariffs on all imports, including precious metals, drive a liquidity shift from London to New York. Since the U.S. presidential election in November, gold reserves on COMEX have jumped by 88%, while demand for bars stored at the Bank of England has surged. At the same time, a weakening U.S. dollar is adding fuel to gold's rally.The imbalance in gold supply between the U.S. and the UK has led to disruptions in the market, pushing up borrowing costs for the metal. One-month gold lease rates have surged to approximately 4.7%, significantly higher than their near-zero levels over the past four years.

This image is no longer relevant

The gold rush has become a new bullish driver for XAU/USD, although the World Gold Council (WGC) acknowledges that the old drivers remain intact. In 2024, central banks purchased 1,045 tons of gold worth $96 billion. While they have been net buyers for 15 years, their buying activity doubled after the start of the Ukraine conflict, fueled by de-dollarization and reserve diversification efforts.

According to the WGC, central bank demand will remain strong in 2025, joined by investors in specialized exchange-traded funds (ETFs), further supporting price growth. Global gold demand increased by 1% to 4,974 tons last year.

This image is no longer relevant

The weakening U.S. dollar is also boosting XAU/USD, a phenomenon that has been dubbed the "help rally" for other currencies in the Forex market. The key reason is Donald Trump's decision to delay tariffs on Mexico and Canada until March 1. The USD index initially surged when the tariffs were announced but later retreated following negotiations between Washington, Ottawa, and Mexico City. Since gold is priced in U.S. dollars, a weaker USD often acts as a catalyst for gold price surges.

This image is no longer relevant

Rising geopolitical tensions are playing a crucial role in gold's upward movement. Donald Trump's plans to deploy U.S. troops to Gaza, relocate Palestinians, and clear unexploded ordnance have triggered concern among Middle Eastern nations, increasing safe-haven demand for gold. Notably, Trump has previously floated controversial geopolitical ideas, such as annexing Greenland and making Canada the 51st U.S. state.

On the daily chart, gold is showing signs of an inside bar formation, indicating market uncertainty. The previous inside bar breakout provided an opportunity for long positions at $2,677 per ounce. Given the current momentum, holding these positions and adding on pullbacks remains a viable strategy.

Key Price Targets:

  • $2,910
  • $2,960

With strong fundamentals and technical signals aligned, gold's rally remains well-supported, increasing the likelihood of new all-time highs in the near future.

Marek Petkovich,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

USD/CAD. Analysis and Forecast

The USD/CAD pair is showing signs of recovery for the second consecutive day after a recent decline, rebounding from a two-week low around 1.4260. Spot prices have climbed above

Irina Yanina 10:16 2025-03-19 UTC+2

XAU/USD. Analysis and Forecast

Gold has halted its upward movement as it attempts to consolidate at new all-time highs around $3,045, with bulls taking a pause ahead of the FOMC meeting results. The Federal

Irina Yanina 09:41 2025-03-19 UTC+2

How Might Markets React After the Fed Meeting? (Expecting a Sharp Decline in GBP/USD and a Drop in #SPX)

Today, the market will focus on the Federal Reserve's final decision on monetary policy. It is expected to bring nothing new, so the main topic will remain the same

Pati Gani 08:27 2025-03-19 UTC+2

What to Pay Attention to on March 19? A Breakdown of Fundamental Events for Beginners

There are few macroeconomic events scheduled for Wednesday, which suggests that volatility for both currency pairs may remain low until the evening. The dollar continues to show signs of weakness

Paolo Greco 06:44 2025-03-19 UTC+2

GBP/USD Pair Overview – March 19: The Inertial Growth Continues

On Tuesday, the GBP/USD currency pair did not attempt to correct once again. There was no macroeconomic background that day, but it is difficult to determine what is currently better

Paolo Greco 02:34 2025-03-19 UTC+2

EUR/USD Pair Overview – March 19: What Will the Fed Meeting Change?

The EUR/USD currency pair continued to trade upward on Tuesday. Although the upward movement is weakening, the euro remains strong while the US dollar keeps falling. This is happening despite

Paolo Greco 02:34 2025-03-19 UTC+2

The Euro Fires a Bazooka

The last time Germany armed itself was in the 1930s, it led to World War II. Today, German militarization is welcomed. According to Bloomberg estimates, fiscal stimulus packages worth around

Marek Petkovich 23:46 2025-03-18 UTC+2

WTI Gains Support from Rising Geopolitical Tensions in the Middle East

For the third consecutive day, West Texas Intermediate (WTI) crude oil is attracting buyers. Currently, the commodity is trading slightly above the key psychological level of $68.00, having gained over

Irina Yanina 18:24 2025-03-18 UTC+2

USD/JPY. Analysis and Forecast

Today, the Japanese yen continues to decline intraday, pushing USD/JPY close to the key psychological level of 150.00, with the pair setting a new two-day high around 149.87. Global market

Irina Yanina 18:21 2025-03-18 UTC+2

Market catches fish in muddy water

Chaos in the White House's economic policy has pushed the S&P 500 to the brink. The broad stock index briefly entered correction territory before rebounding with two consecutive days

Marek Petkovich 11:18 2025-03-18 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.