- And silver is heading towards $100 for first time
Gold was tipped to breach $5,000 an ounce while silver is heading towards $100 for the first time as concerns about the state of the world send investors rushing to the apparent safety of precious metals.
With all eyes on the World Economic Forum in Davos for the arrival of Donald Trump, gold hit a new high of $4,888 an ounce, taking gains for this year to 13 per cent.
Silver, meanwhile, was changing hands at around $95 an ounce having hit a record $95.87 on Tuesday.
It has gained 34 per cent already this year and has more than tripled in value since the start of 2025.
Analysts said gold could now rise to $5,000 while silver is on course to reach $100.
Gold and silver prices have soared as investors look for somewhere safe to park their cash
Investors have flocked to precious metals amid mounting geopolitical uncertainty – turbocharged by Trump’s plan to take control of Greenland – as well as worries about government borrowing, inflation and the weakening dollar.
The latest surge in gold and silver coincided with a stock market sell-off in the early part of this week as Trump’s move on Greenland sparked fears over a new front in his trade war and even the end of NATO.
The US President has vowed to impose a 10 per cent tariff on imports from countries willing to defend Greenland – including the UK, Denmark, Finland, France, Germany, the Netherlands, Norway and Sweden.
The levy would take effect next month and rise to 25 per cent come June.
But after heavy-selling at the start of the week, stock markets were a little calmer on Wednesday, with the FTSE 100 broadly flat in early trading.
‘The FTSE 100 held up in early trading on Wednesday despite a rebound in UK inflation and continued uncertainty over Greenland,’ said AJ Bell head of markets Dan Coatsworth.
‘The hope will be that some form of compromise can be found as Donald Trump meets with European leaders and speaks at the World Economic Forum in Davos.
‘A fresh record high for gold is a reminder of continuing nervousness as people fret over the future of a Nato alliance which has been a key part of the Western world’s firmament in the post-war period.’
Chris Beauchamp, chief market analyst at investing and trading platform IG, said: ‘Gold has surged through $4800 on its headlong rush to $5000, demonstrating that it is often futile to call tops even in the most frenetic of rallies.
‘Just when the bounce seemed to have run out of catalysts, up pops Donald Trump to reignite the trade war, threatening to bring down NATO in the process, and sending the dollar into freefall.
‘It’s not all down to the Greenland saga however. Poland’s central bank is on course to bolster its gold reserves, reminding markets that this isn’t just a momentum-fuelled, “sell the US”, frenzy in precious metals.’
He added: ‘Silver is on “psychological level watch” too, with $100 firmly in the frame.
‘Given the price is up 34 per cent already this year, another 5 per cent might be the work of a few hours, though it’s notable that silver hasn’t reacted in a similar fashion to gold, moving only modestly higher.
‘Silver lacks the central bank buying story that has been fundamental to gold’s rise, and its higher volatility means that there is perhaps more reason to be cautious in the short term.’
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