In a moment that stunned financial markets around the world, gold briefly touched a record-smashing $3,500 an ounce—an ascent fueled by political fireworks, mounting investor anxiety, and a rapidly deteriorating sense of confidence in America’s economic stability. The spark? A familiar name: Donald J. Trump.
The former and potentially future U.S. president reignited tension with the Federal Reserve in a fiery online tirade, calling Fed Chair Jerome Powell a “major loser” and demanding immediate interest rate cuts. The market, already on edge from global trade disruptions and fiscal instability, didn’t wait for the dust to settle. It ran—to the one asset no central banker can print: gold.
As traders sold off stocks, dumped U.S. bonds, and watched the dollar sag to its lowest levels since 2023, gold surged 2.2% in early Tuesday trading to pierce the once unthinkable $3,500 threshold. Although bullion later cooled slightly as some investors took profits, the message was clear: the era of “In Gold We Trust” is back.
The surge marks a 32% rally for gold in 2025 alone, outpacing equities, crypto, bonds—you name it. And while Wall Street grapples with the prospect of a politicized Fed, Main Street is buying gold like it's 1979 again. From Hong Kong to Zurich, and notably in Shanghai, demand has exploded. Even central banks, traditionally cautious, are hoarding gold to hedge against what some are calling a once-in-a-generation breakdown of faith in U.S. leadership.
Trump’s latest outburst wasn’t just campaign rhetoric. It hit a market already nervous about economic fragility, spiraling deficits, and a weaponized dollar that’s left many foreign governments wary. Now, the very foundation of global finance—the belief in the relative safety of U.S. assets—is being called into question.
According to analysts at Jefferies, “gold is now the only true safe haven left.” Normally, when markets panic, money floods into Treasuries. But not this time. With yields whipsawing and Washington’s fiscal credibility teetering, investors are opting out of the dollar game entirely. Instead, they’re going back to basics: a shiny yellow rock that’s outlived every fiat system in history.
Lee Liang Le at Kallanish Index Services put it even more bluntly: “The ‘Trump Trade’ has evolved into a ‘Sell America’ trade.” She’s not alone in that thinking. Banks like Goldman Sachs are scrambling to keep up with bullion’s blistering pace. The firm now sees gold hitting $4,000 by mid-2026, driven by a toxic cocktail of Fed interference, dollar weakness, and global demand.
Behind the scenes, the rally has been building for months. Since early 2024, central banks began quietly shifting away from the dollar, wary of sanctions and looking to de-risk. That move accelerated after a wave of geopolitical flare-ups and monetary shocks, culminating in this week’s Trump vs. Powell showdown. With U.S. Treasuries no longer the go-to panic button, gold’s appeal has become irresistible.
And the excitement isn’t confined to metal bars or ETFs. Gold miners are riding the wave. Zijin Mining, one of China’s largest metal producers, saw shares spike more than 6% Tuesday, bringing its 2025 gains north of 25%. The rally is lifting an entire sector that’s long struggled to shine in the era of digital disruption and passive investing.
But before the gold bugs pop champagne, a word of caution. The rally’s intensity is triggering technical red flags. Gold’s 14-day relative-strength index, a measure of how overbought an asset may be, recently topped 78—well beyond the usual threshold of 70. According to Bloomberg’s Ven Ram, “bullion is extremely overbought in the short term, which makes it ripe for a correction.” Still, he adds, don’t confuse short-term froth with medium-term firepower. As long as global uncertainty remains high—and it does—gold will continue to glisten.
Silver stayed steady on Tuesday, while platinum and palladium nudged higher. Yet it's clear which metal has captured the world’s imagination—and portfolio flows. Gold isn’t just a commodity anymore. It’s a referendum on the world’s faith in American leadership, independence of its institutions, and the sanctity of the almighty dollar.
With Trump barreling toward the Republican nomination and threatening to reshape the Fed, investors are bracing for more volatility. If Powell goes, it’s not just a changing of the guard—it’s a seismic shock to monetary credibility. And in that kind of world, gold doesn’t just shine. It blinds.
Conclusion
Gold at $3,500 is no accident. It’s a signal, a scream, and a siren rolled into one. Markets aren’t just betting on inflation or deflation. They’re hedging against chaos—political, economic, and institutional. Trump’s assault on the Fed didn’t start this gold rush, but it sure as hell accelerated it. And if this is just the beginning, $4,000 might not be the ceiling—it could be the new floor.
