Gold prices soared sharply on Monday morning, registering a significant rally of more than 2%, as rising geopolitical instability and renewed trade threats from U.S. President Donald Trump drove investors to seek shelter in the precious metal.
As of 9:57 a.m. Nigerian time, the price of spot gold climbed from $3,287.93 to $3,353.69 per ounce. This notable spike reflects mounting investor anxiety over global economic disruptions and political uncertainties, pushing gold back into the spotlight as a traditional safe-haven asset.
Global Trade Tensions Rekindle Market Anxiety
Fresh friction between the United States and China has reawakened concerns over the stability of their recent trade agreement. Both nations have accused each other of backtracking on their commitments, fueling fears of a renewed trade war.
This rising uncertainty has made gold more attractive to investors who view it as a hedge against financial volatility. The market’s shift towards safer investments was further amplified by President Trump’s announcement of plans to raise tariffs on foreign steel and aluminum imports to 50%.
Canada responded swiftly, threatening retaliatory measures against Washington’s proposed duties, adding another layer of instability to global trade dynamics.
Weaker Dollar Enhances Gold’s Global Appeal
The U.S. dollar began the week on a weaker note, making gold less expensive for foreign investors and boosting demand globally. This currency depreciation further strengthened bullion’s value in the eyes of investors managing portfolios in other denominations.
Ongoing Conflict Between Russia and Ukraine Fuels Further Safe-Haven Buying
According to Bloomberg, gold prices gained further momentum after Ukraine launched a series of drone attacks deep inside Russian territory on Sunday, reportedly striking military airfields as far east as Siberia.
In retaliation, Russia launched one of its most prolonged and intense missile barrages against Kyiv, escalating the military conflict just days before scheduled peace talks.
This renewed violence in Eastern Europe has only intensified global uncertainty, prompting another surge in demand for gold as a buffer against geopolitical shocks.
Gold’s Resilience in a Volatile Year
Despite recent pullbacks, gold remains one of 2025’s strongest-performing commodities, boasting year-to-date gains of over 25%. This performance underscores the metal’s resilience amid persistent global instability and economic headwinds.
Analysts at Goldman Sachs Group Inc. reiterated their long-term confidence in gold last week, labeling it a core inflation hedge in diversified portfolios. The firm emphasized that alongside oil, gold remains a vital safeguard for investors navigating turbulent financial conditions.
Key Insights for Investors
The surge in gold prices follows a week of market correction, during which the metal briefly lost ground. Spot gold had fallen to $3,273.19 per ounce, while August gold futures dropped below the $3,300 threshold.
The dip came after a U.S. federal court ruled that President Trump lacked the authority to impose sweeping tariffs without congressional oversight. This ruling triggered a temporary shift towards riskier assets, as investor sentiment improved following expectations of eased trade tensions.
However, the U.S. Court of International Trade gave the administration ten days to respond to the judgment. The White House immediately filed an appeal, which has reignited uncertainty and contributed to gold’s rebound.
Additionally, last week’s ruling led to declines not just in gold but also in the Japanese yen, another traditional safe-haven currency. The market’s tilt toward risk-on strategies proved temporary, as recent developments reignited caution across global markets.
Outlook: Gold Likely to Remain in Focus as Uncertainty Lingers
With geopolitical crises intensifying and economic uncertainty remaining high, gold is expected to continue playing a central role in global investment strategies.
Experts caution that while gold may face periodic corrections due to profit-taking or temporary optimism in risk assets, its long-term fundamentals remain strong. As the world grapples with fluctuating trade policies, military escalations, and inflation concerns, gold is poised to retain its safe-haven status for the foreseeable future.
Investors are advised to monitor international developments closely and maintain exposure to gold as part of a balanced risk management strategy, particularly during periods of elevated global tension.
