Gold Soars as Safe Haven Demand Intensifies Amidst Trade Uncertainty

Gold prices maintained their upward trajectory on Friday, extending their winning streak to eight consecutive weeks. The precious metal benefited from heightened safe-haven demand amid concerns over escalating trade tensions and a significant price disparity between US and London markets, encouraging shipments of physical gold to New York.

As of Friday, gold futures hovered around $2,950 per ounce, trailing slightly below their record high from the previous session, while the spot price in London traded near $2,930. Since the beginning of 2023, gold has gained approximately 11%, setting a record 11th high this year.

The ongoing surge in gold prices is attributed to several factors, including:

* Central Bank Buying: Central banks worldwide have been net purchasers of gold, driving up demand and supporting prices.

* Geopolitical Risks: Uncertainty over the Russia-Ukraine conflict and heightened geopolitical tensions have increased demand for safe-haven assets like gold.

* US Tariffs: Plans to impose tariffs on automotive and pharmaceutical goods have raised concerns about broader levies, further bolstering gold's appeal.

* Price Disparity: A significant price difference between gold futures in the US and the spot price in London has prompted institutional investors to ship large quantities of physical gold to New York, leading to a surge in COMEX gold inventories.

Industry experts believe this influx of gold is driven by fears of supply disruptions, which could cause prices to skyrocket. Despite a pause in rate cuts by the Federal Reserve, market uncertainty and expectations of higher central bank demand, led by China, suggest further gains for gold in 2025.

Recent forecasts from Goldman Sachs project a year-end price of $3,100 per troy ounce, while BofA's survey of global fund managers predicts gold will outperform US equities and rank as the second-best-performing asset class in 2025, with a potential to reach $3,300 per ounce if policy uncertainty persists.