Gold prices are soaring to unprecedented heights with no end in sight. The combination of geopolitical crises like the Middle East conflict and uncertainties fueled by the Donald Trump administration’s tariff war has maximized the preference for safe-haven assets.

Global investment banks predict that spot gold prices, which surpassed $3,000 per ounce for the first time in history on the 14th, could climb as high as $3,200 by the end of this year.

According to Reuters on the 18th, international gold prices broke the $3,000 per ounce mark that day, setting a new all-time high. Spot gold briefly hit a peak of $3,038.26 during the session. This marks the second time gold has exceeded $3,000 per ounce since its historic breakthrough on the 14th. Gold prices surged by an impressive 27% last year alone.

Analysts attribute gold’s relentless upward trajectory to investors turning to it as a primary investment vehicle to hedge against uncertainties stemming from the Trump administration’s radical policy shifts.

Reuters reported, “Since President Trump took office in January, his drastic policy changes—including tariffs, an attempt to annex Greenland, and unconventional diplomatic efforts to end the Ukraine war—have driven gold prices to successive record highs.” It added, “Gold, regarded as a safe-haven asset, has risen by more than 14% this year.” ANZ Bank has raised its six-month gold price forecast to $3,200.

The influx of capital has pushed gold exchange-traded funds (ETFs) to new highs day after day. According to the World Gold Council (WGC), gold holdings in European-listed ETFs have increased by 46.7 tons (3.6%) since the start of the year, reaching 1,334.3 tons. Over the same period, U.S.-listed ETFs have seen their gold holdings rise by 68.1 tons (4.3%), totaling 1,649.8 tons.

Ole Hansen, Head of Commodity Strategy at Saxo Bank, commented, “Fund managers and investors needed both a significant price rally and stock market fear to fully commit to gold,” adding, “That’s why we’re seeing massive inflows into gold right now.” The S&P 500, a large-cap index, peaked at 6,147.43 on February 19 but has since fallen to 5,614.66 as of today—a 9.49% drop from its high.

Aggressive gold buying by central banks worldwide is another factor driving prices higher. According to the WGC’s recently published “2024 Gold Demand Trends” report, global gold trading volume (including over-the-counter transactions) hit an all-time high of 4,974 tons last year. The fourth quarter alone saw a 1% increase year-over-year, setting a new quarterly record. While net purchases by central banks and the International Monetary Fund (IMF) dropped by 6 tons (1%) from the previous year to 1,045 tons, this still marked the third consecutive year of exceeding 1,000 tons. Compared to the 2010–2023 average of approximately 550 tons, central bank buying has nearly doubled in recent years.

As gold prices continue to hit record highs, more Korean-Americans are turning to gold investments. While some purchase physical gold due to economic concerns, many are reportedly opting for gold ETFs. According to Korean-American jewelers, inquiries and purchases of physical gold, such as baby rings or gold bars, have increased alongside rising prices.

A Korean-American, Kim, shared, “Last year, I saw over 30% returns from U.S. stocks, but as prices dropped, I sold some holdings and bought gold ETFs. My overall returns are currently negative, but the gold ETFs are cushioning further losses, so I’m holding on.”

<Hongyong Park>