Gold prices surged to another record high on Wednesday. This jump came after tech stocks dropped sharply. The reason? Nvidia warned it could lose $5 billion due to growing U.S.–China trade tensions.
Gold futures climbed more than 3%, hitting $3,350 an ounce. That’s the highest price ever recorded.
Here’s a closer look at why gold is soaring and what’s keeping the rally alive.
Nvidia’s Warning Sparked a Market Shift
Nvidia, a top chipmaker, said it may lose $5 billion in sales. This would come from new tariffs and trade pressure between the U.S. and China.
Investors quickly moved out of stocks and into safer assets. Gold is one of the safest bets during uncertain times. That shift in money helped push gold even higher.
Gold Up Over 25% This Year
Since January, gold prices surged more than 25%. That’s a big rise in just a few months.
The main driver is fear—fear of trade wars, inflation, and slowing growth. Each new headline adds fuel to the rally. And for now, there’s no sign of a slowdown.
Strong Demand from Gold ETFs
Gold-backed ETFs are seeing big inflows. These funds let people invest in gold without holding it physically.
In the first quarter of 2025, investors poured money into gold ETFs. Only one week saw net outflows. In late February and March, demand hit its highest level since 2022.
This strong interest shows people are worried and want safety.
Trump’s Tariff Move Added Heat
Earlier this month, President Trump announced new “reciprocal” tariffs. These are wide-reaching and could affect many industries.
The news shook investors. Within a week, nearly half of fund managers named “long gold” as the most crowded trade on Wall Street.
That’s a big shift. For two years, “long Magnificent Seven” tech stocks topped that list. Now, gold is taking their place.
Many fund managers think gold will be 2025’s top performer.
What Experts Are Saying
Analysts at UBS said gold is more attractive than ever. They pointed to key risks like:
- Ongoing trade fights
- Slower global growth
- High inflation
- Rising geopolitical tension
- A shift away from the U.S. dollar
These risks make gold a smart choice for safety and balance. Even gold mining stocks are rising. Shares of Newmont and Barrick Gold both moved up with gold prices.
Can the Rally Keep Going?
According to the World Gold Council, yes. They believe the rally still has room to run.
Why?
- Central banks are still buying gold.
- Gold ETFs make up just 1.6% of all U.S. ETFs. In 2011, during another big rally, that number was 7.6%.
- Tariff fears and global stress won’t go away soon.
These trends suggest demand will stay strong.
What Could Slow Things Down?
Not all signs point up. There are risks to watch.
If gold gets too pricey, demand could fall. Central banks and investors might pull back.
A sudden need for cash—like during a liquidity crunch—could force people to sell their gold.
And if the U.S. and China reach trade deals, investor fear may ease. That would hurt gold’s rise.
Conclusion
Gold prices surged because people are scared—of trade wars, inflation, and market losses.
Nvidia’s warning was the latest trigger, but the rally started months ago. More investors are picking gold for safety.
With demand rising and fear still strong, gold may stay hot. But sharp moves mean investors should stay alert.
