Gold prices have reached a new peak, exceeding $4,800. This rise is driven by an increased appetite for secure investments in conjunction with a weakening US dollar. Geopolitical tensions are rising following President Donald Trump’s suggestion to purchase Greenland. Allies have suggested possible measures. The dollar is losing value compared to other currencies. This leads to a reduction in the price of gold for buyers around the world. Spot gold rose by 1.2% to $4,818.03 per ounce as of 0125, after reaching a record high of $4,836.24 earlier in the session. U.S. gold futures for February delivery rose by 1% to $4,813.50 per ounce.
On Tuesday, Trump stated that there was “no going back” on his goal to take control of Greenland, clearly indicating he would not rule out the use of force to reach this objective, while also taking aim at NATO allies. Nonetheless, he subsequently remarked, “We will work something out where NATO will be very happy and where we will be very happy.” Meanwhile, French President Emmanuel Macron asserted that Europe would not yield to intimidation or coercion, delivering a sharp critique of Trump’s threat of significant tariffs at Davos if Europe did not comply with his ambitions regarding Greenland.
The dollar stayed weak, lingering near three-week lows against the euro and Swiss franc, after threats from the White House concerning Greenland led to a broad selloff in U.S. assets, such as the currency, US stocks, and Treasury bonds. A depreciated dollar leads to lower prices for dollar-denominated metals, making them more affordable for international buyers. In the ongoing dispute regarding Trump’s attempt to dismiss Federal Reserve Governor Lisa Cook, which is scheduled for consideration by the U.S. Supreme Court on Wednesday, the justices may focus on the president’s use of social media to carry out this unusual action.
The Federal Reserve is expected to maintain interest rates at their current levels during its meeting on January 27-28, despite President Trump’s push for cuts. Gold, lacking interest generation, typically shows robust performance in an environment of low interest rates. Spot silver rose by 0.1% to $94.68 per ounce, after reaching a high of $95.87 on Tuesday. Spot platinum increased by 0.9% to $2,485.50 per ounce after reaching a peak of $2,511.80 earlier in the day, while palladium rose by 0.4% to $1,873.18.