CHENNAI: Gold and silver prices climbed sharply on Tuesday, hitting fresh record highs as investors sought refuge from escalating global uncertainty sparked by renewed trade war fears following US President Donald Trump’s aggressive tariff threats linked to Greenland. Precious metals, long viewed as safe-haven assets in times of risk aversion, attracted heavy buying as equities around the world struggled and market participants weighed the potential impact of widening geopolitical tensions.
In international markets, spot gold approached unprecedented levels near $4,700 an ounce, with U.S. gold futures for February delivery rising above $4,720 an ounce in morning trade, reflecting strong demand from risk-averse investors. Silver also rallied vigorously, touching highs around $94 per ounce, marking one of its strongest performances in recent memory as traders sought protection against market volatility. The surge in prices was not limited to global benchmarks; in India, gold futures for February delivery climbed close to Rs 1,47,000 per 10 grams, while silver futures surged past Rs 3,15,000 per kilogram, both near or at historic peaks as domestic demand mirrored the global trend.
In Indian markets, gold and silver tracked the global surge, rising to fresh record levels as investors sought safety amid heightened uncertainty. Spot prices across major cities also remained elevated, supported by safe-haven demand and firm global cues, although some profit-taking emerged later in the session after the sharp rally.
The trigger for the latest rally was a sharp escalation in rhetoric from the US over the future of Greenland, where President Trump has linked potential tariff measures against several European nations to negotiations on control of the vast Arctic territory. This rhetoric revived fears of a broader US–Europe trade dispute, prompting investors to step away from riskier assets such as stocks and into bullion-based hedges. The threat of new or higher tariffs on multiple European economies unsettled markets, weakening stock prices and the US dollar and reinforcing the appeal of gold and silver.
Market participants noted that while both metals initially spiked to record highs, prices later pared some gains as the session progressed, illustrating lingering uncertainty and profit-taking after the sharp advance. Volatility is expected to persist in precious metals markets as traders adjust to rapidly changing geopolitical signals and weigh the likelihood of sustained safe-haven demand. Many analysts believe that gold and silver could remain elevated as long as geopolitical risks and trade tensions continue to dominate investor sentiment, but caution that the sharp rallies also raise the potential for intermittent pullbacks amid shifting data and policy developments.
"The current price action in gold and silver underscores how deeply global financial markets are being influenced by geopolitical risk, with investors increasingly prioritising capital preservation as uncertainty around tariff policies and international relations intensifies," said one of the analysts associated with an overseas wealth management fund.