Gold moved beyond the $5,200 mark on Wednesday, extending a sharp rally that saw the metal climb more than 3% on Tuesday. The move came as the U.S. dollar weakened to levels not seen in nearly four years, while markets awaited the outcome of a U.S. Federal Reserve monetary policy meeting.
Spot gold was trading up 0.6% at $5,219.97 per ounce as of 0153 GMT, after earlier reaching an intraday record of $5,224.95. The metal has appreciated by more than 20% since the start of the year. In New York, U.S. gold futures for February delivery jumped 2.6% to $5,216.80 per ounce.
Analysts linked the advance in bullion closely to the dollar's slide. Kelvin Wong, a senior market analyst at OANDA, said the move stems from "the very strong indirect correlation with the dollar" and pointed to remarks from President Donald Trump as contributing to the immediate price surge in the U.S. session. Wong noted the president's casual comment about the dollar suggested there may be "a broad-based consensus within the White House to have a weaker greenback going forward."
The dollar itself was described as grappling with a "crisis of confidence" as it hovered near multi-year lows. That dynamic intensified selling pressure on the currency after President Trump said the dollar's value is "great" when asked whether he thought it had declined too much.
At the same time, U.S. consumer confidence fell in January to its weakest level in more than 11-1/2 years, reflecting growing unease over a sluggish labor market and elevated prices. President Trump also said he will soon announce his pick to lead the U.S. central bank and predicted that interest rates would fall once the new chair assumes office.
The Federal Reserve was widely expected to hold interest rates steady at its January policy meeting, which was ongoing as markets monitored commentary and data for clues on future policy paths. Wong flagged potential near-term price resistance for gold around $5,240 per ounce.
Market strategists and banks also weighed in on the outlook for bullion. Deutsche Bank said on Tuesday that gold could rise to $6,000 per ounce in 2026, citing sustained investment demand as central banks and investors boost allocations to non-dollar and tangible assets.
Other precious metals extended recent advances. Spot silver rose 0.6% to $113.63 an ounce after having hit a record $117.69 on Monday, marking almost a 60% gain year-to-date. Spot platinum increased 1.5% to $2,679.15 per ounce after reaching a record $2,918.80 on Monday, while palladium was up 0.9% at $1,951.93.
Market context - The moves in bullion and related metals reflected a combination of dollar weakness, lingering geopolitical concerns, and investor shifts toward non-dollar and tangible assets as market participants awaited the Fed's policy statement.