New York, January 27, 2026, 13:41 EST — Regular session
- Spot gold climbed roughly 1.5% following Monday’s record high; U.S. futures held steady
- Traders are focused on the Fed’s two-day meeting and Chair Jerome Powell’s comments set for midweek
- Markets remain unsettled amid fresh tariff rumors and a looming U.S. funding deadline
Gold prices hovered near record peaks Tuesday, continuing a rally fueled by shifting policy news that keeps markets on edge. Spot gold climbed 1.5% to $5,090.94 an ounce by 11:35 a.m. EST, after hitting a record of $5,110.50 on Monday. February U.S. gold futures edged up 0.1% to $5,086.90. The metal has surged roughly 18% this year. Michael Widmer, a commodities strategist at Bank of America, pointed out that “rallies normally end because the drivers that took people into the gold market originally dissipate – and that’s just not the case.” Reuters
This shift matters because investors no longer see gold as just a slow hedge; they’re using it as a direct gauge of geopolitical tensions and central-bank trustworthiness. In market lingo, “safe haven” refers to assets people flock to when uncertainty spikes.
Trade tensions flared again as President Donald Trump warned he might hike tariffs on autos and other South Korean imports from 15% to 25%. It’s a stark signal that new trade escalations could come abruptly.
Washington is facing a familiar threat. Funding for multiple federal agencies runs out after midnight Friday, and a contentious battle over Homeland Security funding has increased the chances of a partial shutdown.
As the Federal Reserve kicks off its Jan. 27-28 policy meeting, markets brace for a likely hold on rates. Investors will be watching closely when Powell takes the podium after the decision, searching for clues about future moves.
Gold doesn’t generate interest, which is why it usually attracts buyers when investors expect borrowing costs to drop. This connection isn’t consistent on a daily basis, but it tends to hold up when the market is strongly tilted one way.
Some of the buying is more strategic, not just driven by panic. “Gold prices continue to be supported by elevated geopolitical and economic uncertainty,” said Ryan McIntyre, president at Sprott Inc, highlighting central bank demand as nations diversify reserves and cut back on the U.S. dollar. He noted that holdings in physically backed exchange-traded funds — which actually hold gold bars for investors — have risen around 20% compared to a year ago. Reuters
Futures markets are matching that intensity. On Jan. 26, CME Group reported a single-day record of 3,338,528 futures and options contracts in its metals complex, beating the previous high from October.
Sell-side forecasts are pushing gold prices sharply higher. Deutsche Bank projects gold could hit $6,000 an ounce by 2026 and noted that “in alternative scenarios, a $6,900 per ounce price would in fact be more in line with the past two years’ outperformance.” Societe Generale analysts also see $6,000 by year-end, while Morgan Stanley offers a bull-case target of $5,700. Reuters
However, the trade is beginning to feel crowded at these levels. If tariffs ease up, the dollar steadies, or the Fed pushes back aggressively against easing bets, we could see rapid profit-taking after a rally that keeps redefining what counts as “expensive.”
Physical demand remains robust despite record-high prices. In Shanghai and Hong Kong, gold shops are packed with buyers. “We have supply problems,” said Simon Littmann, executive manager at Swiss Investors Corporation Limited, pointing to delays in delivering small gold bars as retail appetite stays firm. Reuters
The Fed decision and Powell’s press conference are set for Wednesday, with Washington’s funding deadline looming shortly after. Traders are on edge, looking for any shifts that could alter the rate or risk outlook in a flash.
