Gold surpasses $5,300 as a sluggish dollar 'fuels' the surge

Gold Surges as Dollar Weakens and Investors Seek Safe Havens

Gold futures soared past $5,300 an ounce on Wednesday before pulling back, as a declining US dollar encouraged investors to move away from traditional currencies and government debt.

The US dollar steadied after hitting its lowest point in nearly four years, following President Trump’s dismissal of concerns over the currency’s slide.

This recent drop in the dollar has been a major driver behind gold’s rally, pushing the metal’s year-to-date gains to 20%.

“The dollar’s decline is accelerating gold’s climb, intensifying the surge in precious metals,” explained Robin Brooks, a senior fellow at the Brookings Institution.

Anticipation of a more accommodative Federal Reserve may also be fueling the move into tangible assets, as investors look to shield their wealth from weakening fiat currencies.

Ole Hansen, who leads commodity strategy at Saxo Bank, noted, “Ongoing unchecked government borrowing is undermining trust in paper currencies.”

Hansen also highlighted increased speculation that President Trump could select Rick Rieder, BlackRock’s global fixed income chief known for supporting aggressive rate reductions, as the next Federal Reserve chair.

The Federal Reserve is widely expected to maintain current interest rates as its two-day policy meeting concludes on Wednesday.

Geopolitical Risks and Central Bank Demand Boost Gold

Rising global tensions are further supporting gold’s rally, with central banks continuing to purchase bullion while reducing their holdings of government bonds.

On Wednesday, President Trump announced that a “massive Armada is headed to Iran,” warning of possible military action if Tehran does not agree to talks.

“Hopefully Iran will quickly ‘Come to the Table’ and negotiate a fair and equitable deal – NO NUCLEAR WEAPONS – one that benefits everyone,” Trump posted on Truth Social.

Other Precious Metals See Strong Gains

Silver prices surged to $112 an ounce on Wednesday before trimming some gains, marking a 48% increase since the start of the year. The rally has been fueled by robust Chinese demand and export restrictions.

Platinum hovered near all-time highs, up 29% for the year, while copper remained steady after surpassing $13,000 in London last week.

Gold bars are stored in a secure facility in Munich, Germany, January 28, 2026. REUTERS/Angelika Warmuth

About the Author

Ines Ferre is a senior business reporter at Yahoo Finance.