- Gold Price rises to around $3,375 in Monday’s early Asian session, up 1.43% on the day.
- Significant uncertainty over Trump’s tariffs on imports into the US supports the Gold price.
- The Fed’s hawkish remarks might cap the upside for the XAU/USD.
The Gold Price (XAU/USD) drifts higher to a fresh record high near $3,375 during the early Asian session on Monday after facing some profit-taking due to the long weekend. Uncertainty about US President Donald Trump's tariff policies and persistent geopolitical tensions continue to underpin the precious metal.
Investors have rushed to safe-haven assets like Gold due to rising uncertainty about tariffs and their impact on the economy, resulting in a more than 25% increase in the yellow metal prices since January. “The case for adding gold allocations has become more compelling than ever in this environment of escalating tariff uncertainty, weaker growth, higher inflation, geopolitical risks & diversification away from US assets & the US$,” said UBS analysts.
Additionally, central bankers have been adding gold to their portfolios. China, the world's largest gold consumer, China added gold to its holdings for the fifth consecutive month, boosting its demand for the precious metal as a safe haven asset in the face of mounting global trade and geopolitical tensions.
On the other hand, the Federal Reserve (Fed) Chair Jerome Powell turned hawkish last week, reducing the likelihood of a Fed rate reduction in June. Meanwhile, San Francisco Fed President Mary Daly said on Friday that the US economy is in a good place, though some sectors are slowing down. This, in turn, could lift the Greenback and weigh on the USD-denominated commodity price.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks

EUR/USD climbs above 1.1650 area on improving risk mood
EUR/USD extends its daily rally and trades above 1.1650 in the American session on Friday. The sharp decline seen in the 1-year Consumer Inflation Expectations component of the UoM Consumer Sentiment Index weighs on the US Dollar and helps the pair push higher.

GBP/USD rises above 1.3450 on USD weakness
GBP/USD gathers bullish momentum and trades above 1.3450 on Friday after struggling to find direction on Thursday. The positive shift seen in market mood and the pullback seen in US consumer inflation expectations hurt the US Dollar and support the pair heading into the weekend.

Gold extends daily recovery beyond $3,350
Gold gains traction on Friday and clings to daily gains above $3,350. Renewed US Dollar (USD) weakness and retreating US Treasury bond yields allow XAU/USD to edge higher, while the upbeat market mood limits the pair's upside.

Bitcoin nears all-time high, Ethereum eyes $4,000, Ripple sets new record
Bitcoin price is trading above $120,000 on Friday, inching closer to its all-time high of $123,218. Ethereum price has surged by over 20% so far this week, with bulls aiming for the $4,000 level next. Ripple has taken center stage, reaching a new record high of $3.66 on Friday, signaling renewed demand and optimism across the market.

China’s first-half growth remains on track, though activity data signals caution
China's second-quarter GDP beat forecasts again with a 5.2% year-on-year growth, driven by strong trade and industrial production. Yet sharper-than-expected slowdowns in fixed-asset investment and retail sales and falling property prices are a concern.

Best Brokers for EUR/USD Trading
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.