The price of gold keeps climbing. On Monday, January 26, the metal exceeded $5,000 (€4,217) per troy ounce (31.1 grams) for the first time — another sign that investors are turning to a traditional safe-haven amid rising geopolitical tensions.
Gold has nearly doubled over the past 12 months and is on its largest rally since the 1970s. Its gains have been notable since 2019, when prices were just above $1,280 per troy ounce.
Why is gold rising so fast?
Gold’s safe-haven appeal intensifies during uncertainty, and several political and economic developments have driven demand. Recent high-profile events — including US President Donald Trump’s threats over Greenland and tariff threats against opposing nations, a US intervention in Venezuela that resulted in the removal of Nicolas Maduro, and ongoing conflicts in Ukraine and Gaza — have stoked investor anxiety.
Analysts point to a broader deterioration in geopolitical conditions that pushes both private and institutional investors to increase gold allocations. Dan Coatsworth, head of markets at AJ Bell, said gold’s rise shows investors are reluctant to abandon their “safety blanket” in case of further destabilizing moves by political leaders. Thomas Kulp of DZ Bank described a “search for a safe haven” as the strongest driver, citing the US action in Venezuela, the suppression of protests in Iran, and the Greenland dispute. DZ Bank expects the gold trend to continue into 2026.
Dollar dynamics and safe-haven flows
Gold’s recent performance also reflects weakening confidence in the US dollar. Last week was gold’s best in nearly 20 years for price gains, while the dollar endured its worst week since May 2025. Dollar weakness can spur more purchases of gold and silver because it makes those metals cheaper in other currencies and reduces confidence in dollar-denominated assets.
Fawad Razaqzada, market analyst at Forex.com, called the recent price action “textbook safe-haven behaviour,” noting that demand for protection persists while confidence in the dollar and bonds looks shaky. In 2025 the dollar fell about 9.5% against a basket of major currencies — its steepest annual decline since 2017 — and many analysts expect further pressure in 2026 amid worries over the US economy, investor diversification away from US assets, and possible Fed rate cuts.
Other currencies have not provided a strong alternative. The Japanese yen has also been under strain amid fiscal concerns in Japan, and speculation about possible currency intervention there could further complicate FX markets and help lift gold.
New types of buyers: ETFs and central banks
The current surge is not only about fear-driven buying. New investors and renewed interest via gold-backed exchange traded funds (ETFs) have materially increased demand. Global ETF assets in gold doubled to a record $559 billion in 2025, according to the World Gold Council. Deutsche Bank analysts noted a potent combination of central bank purchases and resurgent ETF investor demand as two “aggressor” forces lifting gold.
The World Gold Council attributes the ETF inflows to safe-haven buying and momentum — investors piling in as prices rise and the dollar weakens.
Outlook for 2026
Most analysts who expected gold to continue rising into 2026 have so far been proven right. The World Gold Council says the outlook will remain shaped by geopolitical uncertainty and offers multiple scenarios: if growth slows and interest rates fall, gold could see moderate gains; if there’s a severe downturn paired with heightened geopolitical risk, gains could be larger. Conversely, a successful outcome from policies that accelerate economic growth, raise interest rates, and strengthen the US dollar could push gold lower.
Edited by: Uwe Hessler