Gold prices continued their record-breaking rally on Tuesday, reaching an all-time high above $3,450 during Asian trading. Investors are increasingly flocking to the precious metal as a safe haven amid growing concerns of a US recession and broader financial market instability.
The surge in demand for gold reflects ongoing skepticism toward the US Dollar (USD), further driving up the price of the USD-denominated asset.
The pressure on the US Dollar has been exacerbated by continued attacks from former President Donald Trump on Federal Reserve Chairman Jerome Powell. Trump has criticized Powell for not acting swiftly enough on interest rates and has raised concerns about the Fed’s independence, with reports suggesting his administration explored the possibility of removing Powell from his post.
In addition to domestic political pressures, the escalating US-China trade war and its damaging effects on the US economy and inflation continue to provide support for gold prices.
Looking ahead, gold is expected to remain a preferred asset amid ongoing financial uncertainty and Trump’s sustained criticisms of the Federal Reserve. With little significant US economic data on the horizon, gold’s price will likely continue to be influenced by global risk sentiment and developments in the trade war.
