Gold and silver jumped to record highs as President Donald Trump’s increased push to take over Greenland fueled fears of a damaging trade war between the US and Europe.
Spot gold traded near $4,670 an ounce, while silver rose as much as 4.4 percent as Trump’s aggression weighed on the dollar and boosted demand for safe havens.
Customs threats
The US will impose tariffs on eight European countries – including France, Germany and the United Kingdom – that oppose the plan to acquire Greenland. Tariffs of 10 percent will take effect on February 1 and rise to 25 percent in June.
European leaders will hold an emergency meeting in the coming days as they explore possible countermeasures. Member states are considering several options to respond, including retaliatory tariffs on 93 billion euros ($108 billion) of U.S. goods, people familiar with the talks said.
French President Emmanuel Macron may request the activation of the European Union’s anti-coercion instrument, Bloomberg reported. The ACI is the bloc’s most powerful retaliation tool and allows the EU to take a series of steps in response to coercive trade measures, SEEbiz reports.
The Greenland-inspired tensions differ from last year’s Liberation Day tariffs because they “point to a deeper geopolitical fault line,” said Charu Chanana, chief investment strategist at Saxo Markets in Singapore. “The use of tariff threats within the alliance is the kind of confidence shock that can leave a sticky risk premium,” she said, referring to NATO.
Precious metals have rebounded sharply this year, after dramatic gains in 2025, when the US took over Venezuela’s leader and then doubled down on threats to take over Greenland. The Trump administration has also renewed attacks on the Federal Reserve, raising concerns about central bank independence and fueling downgrade trading, where investors shun currencies and government bonds amid concerns about debt levels.
Analysts are optimistic
A broader rotation into the metals complex, led by investors in China, further fueled the recovery in gold and silver. Gold holdings in exchange-traded funds (ETFs) rose by 28 tonnes, or 0.9 percent, last week, the biggest increase since September, and have expanded in seven of the last eight weeks.
Many analysts expect significant gains to continue, and Citigroup Inc. last week he predicted that gold would reach $5,000 an ounce within three months and silver $100.
“Geopolitical risks continue to intensify,” said Kyle Rodda, an analyst at Capital.com Inc. in Melbourne. “New trade uncertainty is undermining growth prospects and US foreign policy is eroding confidence in the US dollar. It’s a perfect combination for gold and silver.”
Spot gold rose 1.6 percent to $4,670.47 an ounce by 1:59 p.m. in Singapore, having hit a peak of $4,690.59 earlier. Silver rose 3.4 percent to $93.1755 and touched a high of $94.1213. Platinum rose slightly, while palladium fell. Bloomberg’s Dollar Spot index fell 0.2 percent.
