Gold Nears $5,000... Hits Record High on Tariff Uncertainty and Fed Concerns

Geopolitical Risks Combined with Policy Uncertainty
Majority of Analysts Predict Gold Prices Will Surpass $5,000 This Year

International gold prices have surpassed the $4,800 per ounce mark, approaching the $5,000 milestone for the first time in history.

Reuters Yonhap News

According to Bloomberg on January 21 (local time), gold futures for February delivery traded on the New York Mercantile Exchange closed at $4,837.5 per ounce, setting a new all-time high. This comes just three months after gold prices broke through the $4,000 level. On the same day, the international spot gold price soared to $4,831.73 per ounce, but as profit-taking sales emerged, it was trading around $4,806 per ounce as of 10:17 a.m. on January 22 (Korea Standard Time).

The Wall Street Journal (WSJ) interpreted the recent surge in gold prices as a result of rising geopolitical and policy uncertainties, citing President Trump's threat of tariffs against Europe (later withdrawn), pressure on Greenland, and political pressure on the U.S. Federal Reserve. In addition, concerns that major currencies, including the U.S. dollar, could weaken if governments fail to effectively control inflation and debt are also fueling gold buying. The aggressive buying trend by central banks has also been identified as a factor supporting the gold rally.

Given these developments, expectations are growing that gold prices will continue to rise this year. In a survey conducted by the London Bullion Market Association (LBMA), most analysts predicted that gold prices would surpass $5,000 per ounce this year. Last year, gold prices set new all-time highs on 53 occasions.

Julia Du, Chief Commodity Strategist at ICBC Standard Bank, presented a strong optimistic outlook, stating, "Gold prices could rise as high as $7,150 per ounce." The WSJ reported, "Historical statistics show that once gold's upward trend begins, it tends to last for a long period. Gold prices, which rose 27% in 2024, soared by as much as 65% last year, and there is growing consensus that the upward trend will continue for the time being."