Gold Surges Past $5,100 as Haven Demand Hits New Gear
Spot gold sets fresh all-time high above $5,100 amid government shutdown risk, Fed uncertainty, and sustained central bank buying.
Gold crossed $5,100 an ounce on Monday, extending a rally that's now up 84% over the past year.
Spot prices touched $5,086 before settling just below that level. The move came on a day when equities rallied—normally a headwind for safe-haven assets. That correlation breakdown says something about the structural nature of current gold demand.
What's Driving It
Four factors are converging.
First, government shutdown risk is back. Senate Democrats announced opposition to a $1.2 trillion funding package over Department of Homeland Security spending, setting up a potential partial shutdown by Friday. Fiscal uncertainty historically benefits gold.
Second, the Federal Reserve meets this week with rates expected to hold steady. The dollar has weakened in anticipation, making gold cheaper for international buyers. Markets now see June as the earliest window for a cut.
Third, geopolitical friction hasn't eased. Tariff threats, tensions over Greenland, and ongoing uncertainty about Fed independence—following reports of a DOJ investigation into Chair Powell—have kept institutional hedging elevated.
Fourth, central bank buying continues. China added to gold reserves for the 15th consecutive month in December. The structural bid from official sector accumulation underpins prices even during quiet news cycles.
The Numbers in Context
Since the start of 2025, gold has nearly doubled.
The metal traded around $2,600 just over a year ago. It crossed $4,000 in late 2025, hit $4,700 earlier this month, and touched $4,924 last Thursday. Monday's move above $5,100 extends that trajectory.
Goldman Sachs lifted its year-end 2026 target to $5,400, up from $4,900. ICBC Standard Bank's Julia Du sees potential for $7,150. MKS PAMP's Nicky Shiels expects $5,400—a "solid 30% up year-on-year."
The analyst community has consistently underestimated the rally for twelve months. Each price target revision has been followed by new highs within weeks.
Silver Moving Too
Silver has participated in the metals rally, crossing $100 an ounce for the first time ever last week before pulling back slightly. The gold-silver ratio has compressed, suggesting broader precious metals demand rather than gold-specific positioning.
Mining equities—Agnico-Eagle, Newmont, Barrick—have outperformed their underlying commodity, a signal that institutional investors expect the rally to persist.
Trading the Move
For traders, the question is whether gold is extended or just getting started.
Momentum favors continuation. The fundamental drivers—fiscal uncertainty, central bank buying, dollar weakness—aren't going away this week. And the Fed's refusal to cut rates has paradoxically supported gold by keeping real rates below inflation in many scenarios.
But $5,100 is psychological resistance. A consolidation phase wouldn't be unusual after a $400 move in four days. Position sizing matters here—the trend is your friend until it reverses hard.
The path of least resistance remains higher, but expect volatility. Gold doesn't move in straight lines, and a 5% pullback in a 84% annual uptrend is noise, not signal.