Gold Climbs to Record Over $5,100 as Debasement Trade Picks Up

Gold surged to a fresh record above $5,100 per ounce, spurred by geopolitical tensions and a flight from sovereign bonds and currencies. The metal leapt as much as 3.6% on Tuesday, hitting an all‑time high of $5,187.37. It marked the biggest intraday gain since April and extended a winning streak that has lasted six sessions.

Silver, meanwhile, stayed near a peak after a 9% jump earlier in the week. It traded close to an all‑time high of $117.71, a level first seen during the previous session. The rally has been backed by strong physical demand and speculative interest, with buyers in China playing a leading role.

Across the market, precious metals have climbed sharply this month. Gold has risen nearly 20% and silver more than 50% since the start of January. A revival of the so‑called “debasement trade” has pushed investors away from currencies and Treasuries, as worries over fiscal spending and currency stability grow.

Recent weeks have seen a massive selloff in Japanese bonds, reflecting concerns about heavy government spending. At the same time, speculation that the United States might intervene to support the yen has weighed on the dollar, making metals cheaper for most buyers.

The former U.S. president’s comments that the dollar was “doing great” and that he was not worried about its decline helped the currency tumble. His broader foreign‑policy stance—potential moves in Greenland, Venezuela, and trade disputes—has added to market uncertainty.

A major European asset manager noted that gold is a strong long‑term hedge against debasement and a way to preserve purchasing power. Investors are also turning to gold, as positioning data shows. Options traders are bracing for further gains, and implied volatility on futures has climbed to levels not seen since the pandemic peak.

The silver‑backed exchange‑traded fund experienced record trading volume, with turnover nearing $40 billion—an almost tenfold jump from the $10 billion seen at the end of December. This activity rivals the turnover of large equity funds.

The metals segment on a leading futures exchange hit a single‑day contract record of about 3.34 million, up 18% from the previous record. Gold prices were around $5,187 per ounce in New York at the close, while the dollar spot index slid 1.1%.

Overall, the rally highlights how geopolitical uncertainty and a reassessment of monetary policy are driving investors toward tangible assets as a safe haven.