The price of gold reached $4,462.10 per troy ounce on the Comex futures market today, setting a new record high for the precious metal. Gold is now up 69% year to date, far outpacing the S&P 500 which is up 17%.
It’s no secret what’s driving gold: political chaos, cheap money, and the collapse of Bitcoin have all underscored gold’s status as a safe haven in times of unrest.
The United States was today pursuing a third Venezuelan oil tanker in hopes of seizing it, part of President Trump’s efforts to destabilize the Maduro regime. In Eastern Europe, Ukraine bombed an oil tanker in the Mediterranean that was part of the illegal “ghost fleet” of Russian ships that keeps Moscow supplied with cash despite international sanctions.
Meanwhile, Wall Street analysts worry about the continued weakening of the U.S. labor market. They are increasingly betting that the U.S. Federal Reserve will cut rates more than once in 2026, although until recently only one cut was expected. Falling interest rates on dollar-denominated assets are bad for the value of the US dollar – and savers looking to preserve their capital therefore appear to be fleeing to gold.
And then there is Bitcoin. The cryptocurrency’s narrative as a “proven store of value” collapsed this year when it hit a high of around $125,000 per coin, then quickly crashed to as low as $84,200, a 34% decline.
With two ongoing armed conflicts over oil, a weak dollar and Bitcoin off the menu of anxious investors, gold is the beneficiary, analysts said in emails sent to Fortune.
Trump offering free money also helps, according to David Miller, CIO at Catalyst Funds and portfolio manager of the Strategy Shares Gold Enhanced Yield exchange-traded fund. “If Trump wants to give $2,000 of free money, then it will be good for gold by creating $2,000 out of nothing without creating new value and then giving it to people. This makes all existing money worth less, which, relative to gold, makes gold more valuable,” he said.
“Nobody is talking about raising interest rates right now and from that perspective there is an asymmetric positive risk for gold because when you lower interest rates it weakens the dollar. That’s good for gold,” he said. “Another piece is the Big Beautiful Bill, because it basically enshrines into law that we’re going to run deficits of $1.8 trillion to $1.9 trillion over the next few years, which will be on top of the existing $38 trillion in debt. That creates more of the same problem in that you’re losing about 5 percent of the value of the dollar every year by continuing to add to that debt.”
Chris Mancini, co-portfolio manager of the Gabelli Gold Fund agrees: “Jerome Powell will likely be replaced by a very dovish Fed chairman in May, who will also support the price of gold. Lower interest rates, higher national debt and persistent inflation will lend to the idea that investors should hold gold in a diversified portfolio as an alternative to cash or U.S. Treasuries.”
