Gold prices surged to a record high amid concerns over Trump's tariff policies, targeting $5,000.
2026-01-20 23:59:00
On Tuesday (January 20), spot gold hit a new all-time high during the US session, reaching $4,748.71, getting closer to the key target of $5,000. With no significant resistance above, no one dares to say the rally will stop there; it's simply a key psychological level that speculators have been eyeing for years. The nearest support and trendline is at $4,584.21, followed by the minor swing low of $4,536.49.
Trump's tariff threats against the EU triggered safe-haven buying of gold.
Safe-haven buying was once again the main driver of today's surge, with traders reacting to renewed global tensions. Driving today's moves was President Trump's threat to impose increasingly higher tariffs on eight major European countries, including Denmark, France, Germany, and the UK, starting February 1st. Trump's threat stems from opposition in Europe to his desire to buy Greenland, sparking market fears of a renewed trade war.
Trade war concerns may push down interest rates, boosting gold demand.
One concern emerging in the market is slowing economic growth. An escalating trade war could severely impact economic growth, but it could also help Trump achieve his goal of lowering US interest rates. Since gold is negatively correlated with interest rates, lower rates could boost demand for gold.
Central bank gold purchases and geopolitical turmoil will drive a 9.6% increase in 2026.
After a steady climb throughout 2025 (driven primarily by large central bank gold purchases to weaken the dollar and continued ETF inflows), geopolitical factors took center stage in the 2026 rally. Events such as the detention of Venezuelan President Nicolás Maduro and the violent unrest in Iran were major contributors to a 9.6% increase in gold prices within 20 days. Market expectations of monetary easing also provided support, but this factor was somewhat mitigated by uncertainty surrounding the timing of a Federal Reserve rate cut in 2026.
The Supreme Court case concerning the independence of the Federal Reserve has become a key source of uncertainty.
(Spot gold daily chart source: FX678)
A new uncertainty arises from the impending ruling by the U.S. Supreme Court concerning President Trump's attempt to remove Federal Reserve Governor Lisa Cook from the voting committee—allegedly in an effort to control interest rates. Many analysts believe that a ruling in Trump's favor could undermine market confidence in the Fed's independence.
Trump's push for interest rate cuts may further enhance the attractiveness of gold.
It's clear from various statements and news headlines that Trump wants the Federal Reserve to lower interest rates. A victory in the Supreme Court could grant him the autonomy of the Federal Open Market Committee (FOMC) if the Supreme Court ruling threatens it. Lower interest rates tend to weaken the dollar, and a weaker dollar benefits dollar-denominated gold.
Trump's tariff threats against the EU triggered safe-haven buying of gold.
Safe-haven buying was once again the main driver of today's surge, with traders reacting to renewed global tensions. Driving today's moves was President Trump's threat to impose increasingly higher tariffs on eight major European countries, including Denmark, France, Germany, and the UK, starting February 1st. Trump's threat stems from opposition in Europe to his desire to buy Greenland, sparking market fears of a renewed trade war.
Trade war concerns may push down interest rates, boosting gold demand.
One concern emerging in the market is slowing economic growth. An escalating trade war could severely impact economic growth, but it could also help Trump achieve his goal of lowering US interest rates. Since gold is negatively correlated with interest rates, lower rates could boost demand for gold.
Central bank gold purchases and geopolitical turmoil will drive a 9.6% increase in 2026.
After a steady climb throughout 2025 (driven primarily by large central bank gold purchases to weaken the dollar and continued ETF inflows), geopolitical factors took center stage in the 2026 rally. Events such as the detention of Venezuelan President Nicolás Maduro and the violent unrest in Iran were major contributors to a 9.6% increase in gold prices within 20 days. Market expectations of monetary easing also provided support, but this factor was somewhat mitigated by uncertainty surrounding the timing of a Federal Reserve rate cut in 2026.
The Supreme Court case concerning the independence of the Federal Reserve has become a key source of uncertainty.
(Spot gold daily chart source: FX678)
A new uncertainty arises from the impending ruling by the U.S. Supreme Court concerning President Trump's attempt to remove Federal Reserve Governor Lisa Cook from the voting committee—allegedly in an effort to control interest rates. Many analysts believe that a ruling in Trump's favor could undermine market confidence in the Fed's independence.
Trump's push for interest rate cuts may further enhance the attractiveness of gold.
It's clear from various statements and news headlines that Trump wants the Federal Reserve to lower interest rates. A victory in the Supreme Court could grant him the autonomy of the Federal Open Market Committee (FOMC) if the Supreme Court ruling threatens it. Lower interest rates tend to weaken the dollar, and a weaker dollar benefits dollar-denominated gold.
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