Gold prices surge past $5,200 on Wednesday

Gold surged past the $5,200 mark for the first time on Wednesday, extending a strong rally as the US dollar slid to near four-year lows amid ongoing geopolitical tensions and ahead of a closely watched US Federal Reserve policy decision.

Spot gold rose 1.4 per cent to $5,262.66 per ounce by 0558 GMT, after touching a record high of $5,266.37 earlier in the session, bringing its gains to more than 20 per cent since the start of the year. US gold futures for February delivery jumped 3.4 per cent to $5,255.30 per ounce.

The rally came as the dollar weakened further, weighed down by what analysts described as a growing loss of confidence in the greenback, following comments from US President Donald Trump that signalled support for a weaker currency. Markets also turned cautious ahead of expected remarks from Federal Reserve Chair Jerome Powell, with investors positioning defensively amid perceived tensions between the White House and the central bank.

The Fed is widely expected to keep interest rates unchanged at its January meeting, even as US consumer confidence fell to its lowest level in more than 11 years, reflecting concerns over the labour market and persistent high prices. Trump also said he would soon announce his nominee for Fed chair and predicted interest rates would fall under new leadership.

Looking ahead, Deutsche Bank said gold could rise to $6,000 per ounce in 2026, citing sustained investment demand and growing allocations to non-dollar and tangible assets by central banks and investors.

Other precious metals also posted strong gains. Spot silver climbed 2 per cent to $115.40 per ounce, after hitting a record high earlier this week, while platinum rose 1.7 per cent to $2,685.16 and palladium edged up 0.7 per cent to $1,946.75.

Attribution: Reuters