Gold Surpasses $5200 Level for the First Time with Dollar Decline

SadaNews Economy - Gold surpassed the $5200 mark today, Wednesday, for the first time in its history, after it jumped by more than 3% in yesterday's session, supported by a decline in the U.S. currency to its lowest levels in nearly four years, amid ongoing geopolitical concerns and ahead of the Federal Reserve's decision on monetary policy.

Gold rose in spot transactions by 1.06% to reach $5244.12 per ounce, after touching a record level of $5247.21 earlier in the session, marking gains of over 20% since the beginning of this year.

U.S. gold futures for February delivery also climbed by 3.00% to $5235.00 per ounce.

Kelvin Wong, senior market analyst at OANDA, stated that the rise in gold "reflects a very strong and indirect correlation with the dollar," noting that the increase in prices during U.S. trading yesterday came after a statement from President Donald Trump in response to a casual question about the dollar, where he hinted at a broad consensus within the White House to adopt a policy that would lead to a future weakening of the dollar, according to Reuters.

The dollar is facing what analysts termed a "crisis of confidence," as it has moved close to its lowest levels in four years, leading to increased selling of the U.S. currency, after Trump stated that the value of the dollar is "fantastic" when asked if it had dropped too much.

In contrast, U.S. consumer confidence fell to its lowest level in over 11 and a half years during January, amid increasing fears about a slowdown in the labor market and ongoing inflationary pressures.

Trump mentioned that he would soon announce his choice for the position of the head of the U.S. central bank, expecting that interest rates will decline as soon as the new president takes office. At the same time, it is widely expected that the Federal Reserve will keep interest rates unchanged in its monetary policy meeting in January.

For its part, Deutsche Bank stated yesterday, Tuesday, that gold prices could rise to $6000 per ounce by 2026, attributing this to continued investment demand, with central banks and investors increasing their allocations to non-dollar tangible assets.

In other precious metal markets, silver rose in spot transactions by 1.9% to $115.11 per ounce, after it recorded a record level of $117.69 on Monday, achieving gains of nearly 60% since the beginning of the year. Platinum also rose in spot transactions by 2% to $2692.60 per ounce, after reaching a record level of $2918.80 on Monday, while palladium increased by 1.4% to $1961.68.