Gold surged past the $5,100 an ounce level on Monday, extending a blistering rally from last week as investors rushed into the safe-haven asset amid heightened geopolitical tensions.

Spot gold jumped nearly 2.5% to a new all-time high of $5,111.11/oz by 18:52 ET (00:52 GMT). U.S. Gold Futures also climbed 2.5% to a record peak of $5,145.39/oz.

Gold advanced more than 8% last week, when prices repeatedly broke historical peaks. It has already risen nearly 17% this year, driven by a combination of geopolitical risk, expectations of easier U.S. monetary policy later in 2026, and sustained demand from central banks.

Other precious metals were also upbeat on Monday. Silver prices rallied 6% to hit a record high of $109.46/oz. Platinum gained 4% to a new peak of $2,910.67/oz.

Geopolitical risks, Trump tariff threats boost gold

A major driver of gold’s surge this month has been escalating tensions between the United States and NATO allies over Greenland, which have unsettled global markets.

Trump’s rhetoric over U.S. strategic interests in the Arctic region has strained transatlantic relations, prompting concerns about broader diplomatic and economic fallout.

Compounding those geopolitical strains, Trump intensified trade friction with Canada this weekend, vowing to impose a 100% tariff on Canadian goods if Ottawa proceeds with a trade agreement with China.

Trump wrote on his social media platform that Canada could be used as a “drop off port” for Chinese goods to enter the United States and warned that Beijing would “eat Canada alive” if such a deal goes ahead

Fed rate decision on tap

Gold has also drawn support from expectations surrounding U.S. monetary policy. The Federal Reserve is due to conclude its policy meeting on Wednesday, and markets are widely anticipating that policymakers will keep interest rates on hold.

While a pause is largely priced in, investors will scrutinise the Fed’s statement and Chair Jerome Powell’s comments for clues on the timing and pace of potential rate cuts later this year.

Lower interest rates tend to support gold by reducing the opportunity cost of holding non-yielding assets.

"Both the data and Chair Powell’s robust defence of central bank independence indicate little prospect of a 28 January Fed rate cut," ING analysts said in a note.

"The focus will be on President Trump’s imminent nomination for the new Fed Chair, the upcoming data, and whether that person can corral the rest of the committee into further cuts," they added.