Gold Prices Surge Amidst Trade Tensions and US Debt Concerns
Gold futures have reached record highs, prompting Goldman Sachs analysts to maintain their bullish outlook for the precious metal. Escalating US tariffs against Mexico and Canada have heightened policy uncertainty, strengthening the role of commodities in diversifying investment portfolios. Analysts emphasize the value of gold as a hedge against tail risks posed by trade tensions and US debt fears.
On Friday, bullion futures exceeded $2,860 per ounce, extending its rally for a fifth consecutive week. The analysts predict that tariff escalations and concerns over US debt could fuel further price increases.
Despite the Federal Reserve's decision to leave interest rates unchanged, gold has continued to rise. The precious metal has gained approximately 6% year-to-date and over 27% since 2024, driven by strong demand from central banks and inflows into gold ETFs.
Goldman Sachs analysts reiterate their belief in gold's long-term prospects, attributing it to structural factors (central bank purchases) and cyclical factors (ETF inflows). They maintain their price forecast of $3,000 per troy ounce for the second quarter of 2026.