Gold Tops $4,660 as Greenland Tariffs Fuel Haven Rush

Gold keeps finding new reasons to rally.

Spot prices climbed above $4,660 per ounce Monday as Trump's tariff announcement on European allies triggered another flight to safety. The yellow metal is now up more than 7% since New Year's Day, extending a run that began with the Powell investigation news earlier this month.

The latest catalyst: 10% tariffs on eight European countries over Greenland, with threatened escalation to 25% by June. That's created fresh uncertainty about transatlantic trade just as markets were digesting the US-Taiwan chip deal and lingering questions about Fed independence.

The Numbers

Gold hit $4,662 in early trading, topping its previous record of $4,642.58 from last Tuesday. That's a gain of about $30 per ounce in a single session, or roughly 0.7%.

Silver followed, trading above $86 per ounce after touching all-time highs near $90 last week. The gold-silver ratio sits around 54—historically tight, suggesting silver's catch-up trade may have further to run.

Both metals outpaced broader commodities. Copper and oil were mixed, while the dollar index held steady against a basket of currencies.

Why Haven Demand Persists

Three factors explain gold's sustained bid.

First, real rates remain low. With the Fed expected to hold rates steady at its January meeting and deliver perhaps one cut later this year, the opportunity cost of holding non-yielding assets like gold stays manageable. The December CPI report showed inflation at 2.9%—still above target but not accelerating.

Second, geopolitical uncertainty has intensified rather than eased. The Greenland tariffs follow the Venezuela situation, the Iran protest crackdown, and ongoing questions about the Fed's political independence. Each event alone might be shruggable; together they create an environment where hedges make sense.

Third, central bank buying continues. Emerging market central banks have been accumulating gold for years as a hedge against dollar dominance. That structural bid provides a floor even when speculative interest fades.

Analyst Targets

Wall Street is raising its estimates.

HSBC sees potential for gold to touch $5,000 in the first half of 2026, though they caution that volatility and pullbacks will increase at these levels. Jupiter Asset Management's Ned Naylor-Leyland told CNBC that $5,000 is "absolutely" possible this year based on underlying demand factors.

More conservative estimates cluster around $4,800-$4,900 for year-end. The bull case requires continued Fed uncertainty and no resolution to current geopolitical tensions—neither of which seems imminent.

Positioning Considerations

Gold's move raises questions about portfolio allocation.

The metal has gained roughly 8% year-to-date on top of 66% in 2025—the best annual performance since 1979. That's created significant embedded gains for long-term holders.

Chasing at these levels carries risk. Gold tends to see sharp reversals when sentiment becomes one-sided, as we saw with silver's December pullback after briefly touching $80.

But the fundamental case hasn't changed. As long as uncertainty persists around trade policy, Fed independence, and global hotspots, gold maintains its appeal as a hedge. The question is whether current prices already discount those risks.

For traders, the $4,500 level looks like technical support after serving as resistance through late 2025. A close below that would suggest the rally needs to consolidate. Above $4,700, the path toward $5,000 becomes more plausible.

The Broader Picture

Gold's rally reflects something beyond just tariff headlines.

Investors are pricing in a world where traditional relationships—between allies, between central banks and governments, between policy and markets—look less stable than they did a year ago. Gold thrives in that environment.

Whether that uncertainty persists or resolves will determine whether current prices hold. For now, the metal keeps setting records while everything else tries to catch up.