Will gold (XAUUSD) continue to achieve record highs…

12 Ocak 2026

Will gold (XAUUSD) continue to achieve record highs, supported by geopolitical risks and cautious anticipation of the Federal Reserve?

Written by: Rania Gule, Senior Market Analyst at XS.com – MENA

Gold is currently experiencing one of its most sensitive phases in years, trading steadily near its all-time highs. This clearly indicates that the market does not view the current rally as a temporary speculative wave, but rather as a structural shift driven by intertwined fundamental factors. In my view, gold’s ability to remain close to its peaks despite the absence of strong expansionary monetary stimulus reflects the depth of investor anxiety and confirms that current demand is driven by the search for safety rather than the pursuit of short-term gains.

The upward momentum that gold has maintained for a third consecutive day cannot be separated from the highly complex geopolitical landscape. US intervention in Venezuela, threats of potential military action against Iran, the intensifying Russia–Ukraine war, and escalating tensions between China and Japan all revive scenarios of broad global instability. In my assessment, this environment is creating structural demand for gold as a safe haven, not merely a temporary reaction to events, which explains the market’s ability to hold near record highs rather than entering sharp corrective moves.

This trend is further reinforced by the gradual erosion of global risk appetite. Investors are not only retreating from high-risk equities and currencies, but are reassessing the global financial system as a whole. From this perspective, I believe gold is benefiting from its status as an asset outside the credit system, unlinked to direct sovereign or political obligations, giving it a relative advantage at times when doubts over the stability of international relations are growing.

On the other hand, the US dollar continues to play a central role in this equation, though not necessarily in its traditional capacity as a competing safe haven. Rising concerns over the independence of the Federal Reserve amid political pressure and heated rhetoric are undermining the dollar’s image as a neutral reserve currency. In my opinion, while these concerns do not imply an imminent collapse of the dollar, they are sufficient to reduce its appeal relative to gold, particularly during periods when markets demand clarity and credibility in monetary policy.

That said, recent US labor market data have limited gold’s upside momentum. The decline in the unemployment rate, despite weaker job growth, has recalibrated market expectations regarding the future path of interest rates. In my view, this delicate balance—data not strong enough to decisively support the dollar, yet not weak enough to force the Federal Reserve into rapid easing—explains the current wait-and-see stance in the gold market.

Markets are now clearly in a holding pattern ahead of the release of US inflation data, which I see as pivotal in shaping gold’s medium-term direction. Should inflation figures come in higher than expected, gold could face temporary pressure due to reduced expectations for rate cuts. However, I believe any pullback would be limited and conditional as long as geopolitical risks remain unresolved. Conversely, signs of continued disinflation could support a renewed rally, pushing gold toward testing additional record highs.

From a broader analytical perspective, I believe gold is no longer moving solely as a hedge against inflation or dollar weakness, but increasingly as protection against geopolitical disorder and the reshaping of global power dynamics. China’s restrictions on rare earth exports to Japan, for instance, are not an isolated trade event but a signal of the growing use of strategic resources as economic weapons—an evolution that enhances the appeal of hard assets, foremost among them gold.

My outlook for the coming period is that gold will remain at relatively elevated levels, with a bullish bias conditioned on the absence of major political breakthroughs or unexpected monetary tightening by the Federal Reserve. I do not rule out phases of profit-taking and technical corrections, but in my assessment these would represent opportunities for repositioning rather than the start of a sustained bearish reversal. The broader trend, in my view, remains upward as long as the global environment is dominated by uncertainty.

In this context, gold today reflects the state of the world more than traditional supply-and-demand dynamics. It is both a psychological and economic indicator, measuring confidence in the global financial and political system. From this standpoint, gold’s proximity to record highs is not a price exaggeration, but a realistic translation of accumulated risks that have yet to find resolution—making the precious metal a core component of any forward-looking market assessment in the period ahead.

 

Zaid Barem / ymm