Financial markets shuddered on Thursday as rising geopolitical uncertainty sent investors scrambling for safety, driving gold to an unprecedented level near $5,600 an ounce. The rally unfolded amid renewed tension between the United States and Iran, after former US President Donald Trump warned of possible military action if Tehran failed to negotiate a new agreement over its nuclear programme — a programme Western powers believe could be aimed at developing an atomic weapon.
As the rhetoric intensified, traders shifted rapidly into safe-haven assets. Gold surged by more than $300 at one point, climbing above $5,595, while silver also touched a fresh peak. Oil prices followed the upward momentum, buoyed by fears that instability in the Middle East could disrupt global supply. The flight to precious metals was further strengthened by a weakening US dollar, fuelled by growing speculation that Trump is comfortable allowing the world’s reserve currency to soften to boost domestic competitiveness.
Meanwhile, the US Federal Reserve offered little direction after delivering a largely uneventful policy announcement. Still, market analysts noted a lingering optimism among traders that interest rates could fall in the months ahead, especially as Trump prepares to announce his preferred candidate for the next Federal Reserve governor. With diplomacy uncertain and monetary expectations shifting, investors appeared to be bracing for volatility — turning once again to gold as a shield against global risk.
