Gold prices surged to $2,770.88 per ounce on Friday, nearing its all-time high of $2,790.17 reached last October. This significant rise is largely attributed to a weakening US dollar and market uncertainty fueled by President Trump’s recent policy pronouncements.

The dollar experienced its worst weekly performance in over a year, dropping 1.77% to 107.465 on the dollar index. This decline followed Trump’s comments suggesting upcoming tariffs might be less severe than initially anticipated. This eased trade war concerns, shifting investor focus to potential inflationary pressures. Gold, a traditional safe haven asset and inflation hedge, consequently saw increased demand.

Further contributing to the dollar’s weakness was Trump’s call for lower interest rates at the World Economic Forum. A weaker dollar makes gold more affordable for international buyers, further boosting demand.

Uncertainty surrounding Trump’s trade rhetoric, including the possibility of a “friendly” resolution with China, has left markets speculating about the extent of future tariffs. The anticipation of upcoming tariff announcements concerning Canada, Mexico, China, and the European Union by February 1st has added to the market’s uncertainty, diverting attention from the upcoming Federal Reserve meeting. The expectation that the Fed will maintain current interest rates also strengthened gold’s appeal in a low-yield environment.

Analysts predict that gold’s upward momentum could lead to a retest of its all-time high. The continued weakness of the dollar, combined with ongoing uncertainty surrounding trade policy, creates a positive outlook for further price increases. However, future tariff announcements and shifts in overall market sentiment will be crucial factors influencing gold’s price in the coming week.