Gold Steadies as Cooling Greenland Crisis Eases Haven Buying
Gold steadied as tensions over Greenland cooled, pausing a run to safety that has pushed bullion to fresh records.
The precious metal traded near $4,825 an ounce, less than $15 shy of reaching an all-time high for a fourth consecutive session. US President Donald Trump withdrew a threat of tariffs against European nations on Thursday after agreeing a “framework for a future deal” on Greenland during talks with NATO Secretary-General Mark Rutte.
Trump’s brinkmanship over Greenland had sparked a diplomatic crisis with European allies and spooked financial markets, adding to gold’s appeal as a haven asset. The precious metal is up nearly 11% this year, with geopolitical tensions fueling a blistering rally that has seen bullion smash on record after another over the past year.
This recent instability reveals “the weaponization of commodities, energy, and supply chains” by dominant world powers, Nicky Shiels, head of research at precious metals refiner MKS Pamp SA, said in a note. This would support gold, she added.
Increased geopolitical risk has been accompanied by the Trump administration’s renewed attacks on the Federal Reserve, eroding confidence in the dollar and supporting precious metals. The US president’s effort to fire Fed Governor Lisa Cook over unproven mortgage-fraud allegations was met with concern at a hearing on Wednesday, where Supreme Court justices said the move could upend the Fed’s independence and rattle markets. The court is set to rule by July.
The meeting between Trump and Rutte at the World Economic Forum in Davos, Switzerland, “took some of the temperature out of the US-EU tension,” said Nicholas Frappell, global head of institutional markets at ABC Refinery in Sydney. But there are still “plenty of dip-buyers” supporting the gold price, he added.
Goldman Sachs, meanwhile, lifted its year-end gold price forecast to $5,400 an ounce from a previous estimate of $4,900, citing intensifying demand from private investors and central banks. Analysts Daan Struyven and Lina Thomas said in a note dated Jan. 21 that risks were “significantly skewed to the upside because private-sector investors may diversify further on lingering global policy uncertainty.”
Silver climbed as much as 1.4%, above $94 an ounce, having earlier fallen as much as 2.4%. The white metal has tripled over the past year, boosted by a historic short squeeze and a wave of retail buying that left banks and refiners scrambling to meet unprecedented demand.
Confusion surrounding a Chinese policy update on export licenses has amplified the perception of scarcity, while the market remains exceptionally volatile even after the US refrained from slapping blanket import tariffs on critical minerals including silver and platinum.
Gold was little changed at $4,828.82 an ounce as of 10:41 a.m. in London. Silver advanced 0.7% to $93.74. Platinum and palladium also edged up. The Bloomberg Dollar Spot Index, a key gauge of the US currency’s strength, was flat.
Source : Bloomberg.com
