April 21, 2025 — Gold prices soared to a fresh all-time high above $3,400 on Monday, as renewed geopolitical tensions and concerns over the Federal Reserve’s independence hammered the US Dollar, prompting investors to seek safety in the yellow metal.
After a brief dip ahead of the Easter weekend due to profit-taking, gold resumed its upward momentum at the start of the week. The surge comes as the US Dollar sinks to a three-year low, driven by mounting fears of a US recession amid an intensifying trade conflict with China.
Over the weekend, the trade standoff escalated after a Boeing aircraft, destined for a Chinese airline, was sent back to the US in what appears to be a retaliatory measure by Beijing. This followed President Donald Trump’s directive to investigate the imposition of new tariffs on all critical mineral imports from China, citing national security risks.
In a statement, Trump emphasized that the US’s reliance on Chinese mineral imports threatens not only national defense but also economic stability. The investigation, under Section 232 of the Trade Expansion Act of 1962, will be led by Commerce Secretary Howard Lutnick.
Meanwhile, the US Dollar faces additional pressure as questions swirl around the Federal Reserve’s independence. White House Economic Adviser Kevin Hassett told reporters Friday that the administration is still evaluating whether it can dismiss Fed Chair Jerome Powell—an unprecedented move that could shake global markets.
The combination of a weakening dollar and heightened safe-haven demand has propelled gold’s rally, with thin Easter Monday trading conditions potentially adding to volatility. Investors are now closely watching for further developments on trade tariffs and any comments from Federal Reserve officials for clues on the direction of gold prices.
With a light economic calendar this week, market focus will remain on geopolitical headlines and sentiment-driven flows until the release of the S&P Global US flash PMI figures later in the week.