Summary
MARCH 18, 2025 – Gold prices surged to a record high above $4,281.50 CAD per ounce, driven by escalating tensions in the Middle East and growing concerns over a slowing U.S. economy. The precious metal’s appeal as a safe-haven asset was underscored by geopolitical instability and economic uncertainty, with investors reacting to data suggesting a downturn in U.S. economic performance. This milestone reflects a 15% increase in gold prices so far this year, building on a strong performance in 2024, as major banks have raised their price forecasts and inflows into physically-backed gold exchange-traded funds (ETFs) have risen for five consecutive days, with ETF gold holdings up 5% in 2025 after four years of decline.
Despite the bullish momentum, analysts caution that gold faces short-term resistance around the $3,000 USD mark, though its role as a store of value remains robust amid a gloomier outlook for both the U.S. and global economies. Factors such as souring consumer sentiment, mounting financial stress, and the risk of escalating trade wars—exacerbated by U.S. President Donald Trump’s policies—have fueled this rally. While some experts, like Vasu Menon from Oversea-Chinese Banking Corp, suggest that $3,000 could act as a psychological barrier, the sustained demand and economic backdrop indicate that gold’s upward trajectory may persist, supported by its status as a hedge against uncertainty.
