Gold prices soared to a record high today (Thursday), driven by mounting economic and geopolitical uncertainties. Fears of an escalating trade war, spurred by U.S. President Donald Trump’s latest tariff threats, have intensified safe-haven demand for the precious metal.

Spot gold hit an all-time high of $2,954.69 before stabilizing at $2,930.19 per ounce, Reuters reported. With inflation concerns rising and central banks increasing their gold purchases, investors are eyeing even higher price levels in the coming months.

Trade War Fears and Inflation Concerns

Gold has gained 12% this year as investors seek protection against global economic instability. Trump’s latest remarks about imposing tariffs on lumber, automobiles, semiconductors, and pharmaceuticals have reignited concerns over global trade disruptions.

The Federal Reserve’s latest meeting minutes revealed that policymakers remain cautious about inflation, reinforcing expectations that interest rate cuts may not come soon. This has further bolstered gold’s appeal, as the non-yielding asset thrives in uncertain monetary environments.

Beyond geopolitical risks, central bank purchases continue to support gold’s upward trajectory. Exchange-traded funds (ETFs) have also seen three consecutive days of inflows, indicating growing investor appetite for gold.

Increased demand from central banks and ETFs, coupled with concerns over a prolonged trade war, has reportedly led Wall Street analysts to raise their gold price forecasts.

Geopolitical Developments and Short-Term Movement

Although gold’s fundamentals remain strong, some analysts caution that a potential peace agreement between Russia and Ukraine could momentarily dampen safe-haven demand. However, some maintain that the record high could hold for weeks, given the number of supporting factors.

Elsewhere, Bitcoin, also considered a safe haven by some, has shown some heightened volatility in the recent past but remains below the $100,000 psychological level. At the time of this publication, the leading digital asset changes hands for $97,626, representing a 1% and 2% increase in the past day and week, respectively.

Today, #gold pared gains after reaching a record of US $2,954.84/oz, as traders booked some profits after US Treasury Secretary Scott Bessent dismissed speculation that the government might revalue its bullion holdings. Click to access.
👉 https://t.co/b4YdexYYMN#goldprice pic.twitter.com/O3THL5S14b

— Prospect Ridge Resources (@ProspectRidgeBC) February 20, 2025

How High Can Gold Go?

Despite occasional pullbacks, analysts remain bullish on gold’s long-term trajectory. UBS has set a peak forecast of $3,200 per ounce later this year, while Goldman Sachs raised its 2025 outlook to $3,100, the Barron’s reported.

If trade tensions persist and economic uncertainty remains high, some analysts believe gold could reach $3,300 before the year ends. With inflation risks, central bank demand, and ongoing geopolitical tensions shaping market sentiment, gold’s rally may be far from over.

Investors continue to watch for developments in U.S. trade policy and Federal Reserve signals, as these factors will play a crucial role in determining whether gold extends its record-breaking run.