Gold prices continued to hit record highs on Thursday, exceeding the $5,500 level and nearing $5,600, as U.S.-Iran tensions intensified and global conflicts roll on.
According to the latest market data, spot gold rose over 2.4% day-on-day to $5,548.50 an ounce as of 08:00GMT, after touching an all-time high of $5,595.44 earlier in the session. Prices gained about 13% over the week.
Gold has surged roughly 102% over the past 12 months and about 29% since the start of the year, supported by heightened trade and geopolitical tensions as well as interest rate cuts by major central banks.
Silver has also advanced, rising over 1% to an all-time high of $120.43 an ounce. Silver prices have jumped more than 283% over the past year.
Meanwhile, the Fed held the policy rate unchanged at the target range between 3.5% and 3.75% on Wednesday, saying that economic activity has been expanding at a “solid” pace.
Fed Chair Jerome Powell said during a press conference after the decision that the central bank would consider reducing the policy rate after prices declined.
Powell said he expects to see “the effects of tariffs flowing through goods prices peaking and then starting to come down, assuming there are no new major tariff increases that are begun.”
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“And that’s what we expect to see over the course of this year. If we see that, that would be something that tells us that we can loosen policy,” he added.
U.S. war with Iran?
Tensions between the U.S. and Iran have been ramping up as President Donald Trump said in a social media post on Wednesday that a “massive armada” was moving toward Iran, warning Tehran to reach an agreement or face a “much worse attack.”
Trump said the fleet, led by the aircraft carrier Abraham Lincoln, was larger than the one previously deployed to Venezuela and was “prepared to rapidly fulfil its missions with speed and violence if necessary.”
In response, Iran’s Ambassador and Permanent Representative to the United Nations, Amir Saeid Iravani, has officially denounced the explicit military threats posed towards Tehran, emphasising that Washington would bear full and direct responsibility for any unpredictable repercussions.
China and other countries also warned that any U.S.-led military adventurism against Iran could recklessly destabilise West Asia and drive the region toward unpredictable consequences.
Gold prices often rise during global conflicts because investors shift their behaviour under stress. It’s less about gold suddenly becoming more “valuable” in a practical sense and more about how humans and financial systems react to uncertainty.
When conflict breaks out, wars, geopolitical crises, major global events, markets face significant uncertainty.
Stocks may fall because companies could be disrupted. Currencies can weaken if countries are directly involved. Supply chains may break down. In that environment, investors look for assets that are perceived as stable and unlikely to default. Gold has historically filled that role.
Gold and silver also boast a historic legacy as being a highly prized commodity and even currency for much of human history, meaning that the material maintains significant global value and significance spanning across all cultures.
When currencies crash, gold is seen as a safe alternative to protect wealth.
