Amid mounting concerns over Donald Trump’s planned tariff war, investors are pouring money into gold funds at the fastest rate since the COVID-19 pandemic.
Gold prices hit an all-time high of $3,148.88 per troy ounce on Tuesday before settling at $3,114, representing an 18% increase this year and the strongest quarterly performance since 1986.
Investors have channeled over $19.2 billion into gold-backed ETFs during Q1 2025, according to Standard Chartered. This flight to haven assets also includes increased holdings in US Treasuries and cash, with cash positions in investor portfolios jumping by the largest monthly amount in five years.
While central bank buying has historically driven gold purchases, the recent surge in ETF inflows indicates broader investor participation seeking protection from potential economic slowdown and market volatility. Several banks, including Macquarie, have raised their gold price forecasts, with predictions of it reaching $3,500 this year.