Gold Prices Hold Firm Near Record Highs Despite Market Turmoil

Gold prices wrapped up last week hovering just above the $3,000 mark, ending a five-week winning streak. The slight decline followed a bout of profit-taking, but analysts remain optimistic about the metal’s long-term prospects, especially as global markets continue to reel from fresh tariff-related shocks.

In the wake of former U.S. President Donald Trump’s newly imposed trade tariffs, financial markets around the world have been thrown into disarray. Yet gold — often regarded as a safe haven — has held its ground remarkably well, with Dubai-based analysts describing it as a “beacon of stability” in an otherwise volatile investment landscape.

“Amid the tariff storm, gold isn’t just surviving — it’s proving indispensable,” said Joy Alukkas, Chairman of Alukkas Jewellery Group.

Market Snapshot

Gold spot prices settled at $3,023 an ounce on Friday, reflecting a 2% decline from the previous week and a 4.5% retreat from Thursday’s record high. However, the dip is seen as relatively mild when compared to the steep losses across global equity markets.

Despite the pullback, investment giants like Goldman Sachs remain bullish. The firm reiterated its $3,300 year-end forecast, calling gold its “highest-conviction view in commodities.” Analysts point to gold’s resistance to tariffs, rising central bank demand, and anticipated U.S. Federal Reserve rate cuts as powerful tailwinds.

“Short-term pressures may have sparked the dip, but the bigger picture for gold remains strong,” noted analysts at Goldman Sachs.

Central Bank Demand and Rate Expectations Fuel Optimism

Emerging markets’ central banks continue to stock up on gold, aiming to diversify away from the U.S. dollar. Meanwhile, expectations of looser monetary policy in the U.S. are expected to drive exchange-traded fund (ETF) inflows into gold.

Chris Vecchio of Tastylive.com shared his confidence in gold’s role as a portfolio stabilizer: “In a cash-raising environment where everything’s being sold, gold is doing its job and absorbing some of the shock.”

While not everyone shares the same outlook — with some like John Mills of Morningstar warning of a possible dip to $1,820 — most analysts lean toward a more bullish scenario. David Morrison from Trade Nation sees the recent drop as a healthy correction. “If gold finds a base around $3,000 or $2,900, it could set the stage for another strong rally,” he said.

Neil Welsh of Britannia Global Markets added, “Gold has more than one route back to record highs — whether through a neutral Fed, economic weakness, or ongoing geopolitical uncertainty.”

A Resilient Outlook

Federal Reserve Chair Jerome Powell’s reluctance to cut interest rates adds complexity to gold’s trajectory. Higher bond yields and a stronger dollar typically act as headwinds. Still, experts like Naeem Aslam from Zaye Capital Markets maintain a positive stance: “I wouldn’t bet against gold long-term — it’s still a buy-the-dip opportunity, especially around the $3,000 level.”

Kaynat Chainwala of Kotak Securities echoed this, citing a combination of central bank buying, inflation concerns, and robust ETF demand as factors likely to support prices in the weeks ahead. With gold currently trading above $3,120, the market now awaits upcoming U.S. jobs data and statements from the Federal Reserve for further cues.

Source: Adapted from original reporting by Khaleej Times – “Tariff turmoil tanks markets, but gold shines as ultimate haven”, published April 6, 2025.