Gold extended its rally on Monday, decisively breaking above the USD 5,000 mark for the first time, as investors sought safe-haven protection amid a fresh wave of geopolitical and policy-driven uncertainty.
In the US, Trump threatened 100% tariffs on Canada should it pursue a trade agreement with China, raising fears of another escalation in global trade tensions.
In Eastern Europe, ongoing tensions between Russia and Ukraine, despite diplomatic talks, underline how fragile the situation remains, keeping geopolitical risk firmly priced into markets. Elsewhere, tensions in Venezuela and the Middle East continue to simmer, further supporting demand for safe-haven assets.
Attention now turns to the upcoming Federal Reserve decision. Rates are expected to remain unchanged, leaving markets focused on guidance for 2026. A dovish outlook would likely propel gold even higher, while a more cautious tone might slow the rally. Even so, the broader outlook remains bullish, underpinned by persistent geopolitical stress, steady central bank buying, strong ETF inflows, and growing concerns over potential challenges to the Fed’s independence.
