Gold Surpasses $3,500 as Trump Era Drives Global Flight to Safety

Gold prices reached a record high of $3,508.50 per ounce on September 2, 2025, as investor demand for the precious metal continues to surge amid ongoing global economic uncertainty. The spot price has risen nearly a third since the beginning of 2025, fueled by concerns over US trade policies, geopolitical tensions, and the perceived erosion of the Federal Reserve’s independence [1]. Analysts have pointed to the broader macroeconomic environment, including US dollar weakness and inflationary pressures, as additional drivers of gold’s upward momentum [2].

The surge in gold prices has been attributed in part to the economic uncertainty created by former US President Donald Trump’s wide-ranging tariff policies, which have disrupted global trade and heightened investor anxiety. Adrian Ash, director of research at BullionVault, noted that the rise in gold prices over the past several months is primarily linked to Trump’s impact on geopolitical stability and global trade dynamics. This trend was further reinforced by concerns over Trump’s repeated attacks on the Federal Reserve and his attempt to remove a member of the board, Lisa Cook, which some economists view as a threat to central banking independence [1].

Derren Nathan from Hargreaves Lansdown added that Trump’s actions have driven renewed interest in safe-haven assets, with gold becoming an increasingly attractive investment. The European Central Bank’s Christine Lagarde has also expressed concerns that any further undermining of the Fed could have a “very worrying” impact on economic stability, both in the US and globally [1]. This sentiment has contributed to increased gold buying from institutional investors and central banks, who have been steadily adding bullion to their reserves.

The demand for gold has also been sustained by continued appetite in major consumer markets such as China and India, where jewellery buyers are shifting toward investment-grade gold products such as bars and coins instead of reducing their purchases altogether. This shift has helped mitigate the usual slowdown in buying that typically occurs when prices rise sharply. In addition, the ongoing conflict in Europe, along with the broader uncertainty surrounding global trade policies, has further reinforced gold’s status as a preferred store of value [1].

Market analysts have projected further gains for gold, with Mark Haefele, chief investment officer at UBS Global Wealth Management, predicting the price could reach $3,700 an ounce by June 2026. Some observers have even speculated that gold could climb to $4,000 an ounce if geopolitical tensions or economic conditions deteriorate further [2]. The US dollar has also faced selling pressure, with expectations of a Federal Reserve interest rate cut in September raising the appeal of gold as a non-yielding but stable alternative.

Central banks across the world, including those of India, China, Turkey, and Poland, have been increasing their gold reserves, reflecting a broader shift away from US treasuries amid concerns over US debt and geopolitical instability. According to a European Central Bank report, gold has surpassed the euro to become the world’s second-largest reserve asset, trailing only the US dollar [2]. This trend is likely to continue as more central banks seek to diversify their holdings in response to global economic uncertainties.

Source:

[1] Gold price hits record high as investors seek safety (https://www.bbc.com/news/articles/ceqyq7r8703o)

[2] Gold price hits record high as investors seek safe haven (https://www.theguardian.com/business/2025/sep/02/gold-price-record-high-bullion-donald-trump)