Gold and silver surged to fresh record highs as escalating geopolitical tensions linked to US President Donald Trump’s renewed push to take control of Greenland rattled markets and fuelled safe-haven demand.
Spot gold climbed to around US$4,660 an ounce, while silver jumped as much as 4.4%, supported by a weaker US dollar and heightened investor appetite for defensive assets.
Market jitters intensified after the United States announced plans to impose tariffs on eight European countries — including France, Germany and the United Kingdom — that oppose the Greenland move. Initial levies of 10% are set to take effect on Feb 1, rising to 25% by June.
European leaders are expected to convene emergency talks in the coming days to discuss possible countermeasures. Options under consideration include retaliatory tariffs on up to €93 billion (US$108 billion) worth of US goods, according to sources familiar with the discussions. French President Emmanuel Macron may also push for the activation of the European Union’s anti-coercion instrument, one of the bloc’s strongest trade retaliation tools.
Analysts said the current tensions represent a deeper geopolitical rift compared with previous trade disputes. “Using tariff threats within alliances creates a trust shock that leaves a lasting risk premium,” said Charu Chanana, chief investment strategist at Saxo Markets in Singapore.
Precious metals have extended their strong rally this year, building on sharp gains in 2025, amid rising geopolitical risks, renewed pressure on the US Federal Reserve, and concerns over the independence of the central bank. These factors have strengthened the so-called debasement trade, as investors move away from currencies and government bonds.
Demand has also been boosted by increased buying from China and a broader rotation into metals. Gold-backed exchange-traded fund holdings rose 0.9% last week, the largest weekly increase since September, and have expanded in seven of the past eight weeks.
Bullish forecasts remain intact, with Citigroup Inc recently projecting gold prices could reach US$5,000 an ounce within three months, while silver may climb to US$100.
“Geopolitical risks are intensifying, trade uncertainty is undermining growth, and confidence in the US dollar is weakening,” said Kyle Rodda, an analyst at Capital.com in Melbourne. “It’s an ideal environment for gold and silver.”
In Asian trading, spot gold rose 1.4% to US$4,658.31 an ounce after touching an intraday high of US$4,690.59. Silver gained 3% to US$92.84, after hitting a peak of US$94.12. Platinum edged higher, palladium slipped, and the Bloomberg Dollar Spot Index fell 0.1%.
Investors are also watching closely an upcoming US Supreme Court hearing on Trump’s bid to remove Federal Reserve governor Lisa Cook, which could have significant implications for the central bank’s independence.
