Gold investors were likened to deal-hungry shoppers today as the price of the precious metal rebounded after days of heavy selling.
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Gold futures rose 6% to $4,936.10 per ounce, while spot gold was up 2.08% to $4,910.27. The SPDR Gold Shares ETF (GLD) raced 5% higher.
Gold Jitters Ease
The revival in gold followed a huge sell-off over the last few days – see below – after U.S. President Donald Trump named Kevin Warsh as his nomination to replace Jerome Powell as the next chairman of the Federal Reserve.
This strengthened the U.S. dollar, which impacts gold as it makes bullion – priced in the currency – more expensive for overseas buyers.
There were also concerns that Warsh might halt any further interest rate reductions to battle inflation. Again, gold prices tend to do well in lower interest rate environments.
However, the weakening of the U.S. dollar index, which tracks the greenback against a basket of six currencies, today has helped gold prices regain some of their shine.
Buying the Dip
There was also a case of investors buying the dip, especially given that many of the economic and geopolitical factors which have driven gold higher over the last twelve months still remain.
ING head of commodities strategy Warren Patterson and commodities strategist Ewa Manthey said that “gold’s fundamental story remains unchanged.”
“The structural drivers – elevated geopolitical risk, macro uncertainty, diversification flows and ongoing central‑bank buying – remain firmly in place,” they said. “Central banks bought less last year but remain key marginal buyers, while current price levels are likely to attract renewed interest.”
Russ Mould, investment director at AJ Bell, added: “The sharp sell-off in gold over the past few days has encouraged investors to buy on the dip, scooping up the precious metal in their droves and making it sparkle again. Gold has delivered such strong rewards to investors over the past year that many people will have treated the recent sell-off as a New Year’s sale, a chance to grab more metal at a discounted price. Gold bugs have doubled down rather than run for the hills.”
Analysts also remain optimistic, with JPMorgan Chase (JPM) having a year-end 2026 price target on gold of $6,300.
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