Gold at $5,000: The world’s fear thermometer is flashing red

Against a backdrop of mounting global tension and uncertainty, gold continues to break its own records. The price of an ounce has now surpassed $5,000, a figure that stands as a clear indicator of the crisis we described above. Throughout history, gold has never been merely a commodity; it has been a measure of fear, of unpredictability, and of political risk. Today, the world economy and geopolitics have reached a stage where investors once again feel compelled to seek refuge in the oldest safe haven.

Recent figures confirm the scale of this surge: spot gold has risen to $5,085, setting a new record, with US futures following the same trajectory. Over the past year alone, gold has appreciated by more than 60 per cent. Such numbers are not random; they are the product of several converging forces that reveal the fragility of the current order.

The first and most decisive factor is geopolitical uncertainty. President Donald Trump’s confrontational rhetoric toward European allies, coupled with steep tariffs on Canada and France, has cast doubt on the stability of the global trading system. For decades, the United States was seen as the anchor of free trade and predictable economic policy. That image is now eroding, and the credibility of the dollar and US financial institutions is directly affected. As risks mount, investors turn to assets immune to political decisions—and gold remains unrivalled in that role.

Another issue which one cannot ignore is the military dimension. The United States is amassing forces in the Gulf of Aden, and many analysts believe a confrontation with Iran may be imminent. Recent events already show how war risks drive gold higher: the Israel–Iran conflict and the ongoing Russia–Ukraine war have both pushed gold toward record levels. A direct clash between Washington and Tehran would shake global markets profoundly. Investors would flee riskier assets and rush into gold. Rising oil prices, triggered by such a conflict, would stoke inflation fears, further boosting gold’s appeal. And as doubts about the dollar’s reliability grow, central banks and funds would expand their gold holdings.

The second factor is monetary policy. Expectations that the Federal Reserve may cut interest rates weaken the appeal of the dollar. A softer dollar makes gold more attractive to investors calculating returns in other currencies. As the Japanese yen strengthens and the dollar loses ground, capital flows into gold accelerate. In this sense, gold is not merely a hedge against fear but also a rational response to shifting currency dynamics.

The third factor is the strategic behaviour of central banks. China has been steadily increasing its gold reserves for fourteen consecutive months. This is not a routine diversification of portfolios; it is a deliberate political signal. Beijing seeks to reduce its dependence on the dollar and reinforce financial sovereignty. In this context, gold becomes a geopolitical instrument, a way of asserting independence from Western-dominated financial structures. Other emerging economies are following the same path, structurally boosting demand for gold.

Private investors are reinforcing this trend. Exchange-traded funds linked to gold have seen record inflows, suggesting that gold is no longer viewed solely as a crisis asset. It is increasingly perceived as insurance against long-term systemic risks. Investors are not only worried about wars or financial crashes; they are concerned about the fragmentation of global governance itself. The erosion of multilateral institutions, the weakening of alliances, and the unpredictability of leadership all contribute to a sense that the world is entering a prolonged period of instability.

The phenomenon is not confined to gold alone. Silver, platinum, and palladium have also reached record levels. This collective surge in precious metals signals that inflationary expectations, industrial risks, and uncertainties surrounding the energy transition are being felt across a broader spectrum. The market for precious metals is sending a collective alarm, a warning that the global economy is entering uncharted waters.

The central question, of course, is whether this rise in gold is sustainable. The short answer is that as long as the current conditions persist, the upward trajectory will continue. If the global balance of power remains unstable, if confidence in US leadership continues to erode, and if monetary policy risks intensify, gold will retain its allure. The $5,000 figure is not just a price tag; it is a psychological marker. It tells us that the world is far from stable, that fear is once again the dominant emotion guiding capital flows, and that trust in institutions is dangerously thin.

The metal’s ascent is more than a financial story; it is a mirror reflecting the collective anxiety of our time. Looking into that mirror, what we see is not stability but fragility, not confidence but doubt. Gold at $5,000 is the world’s fear thermometer, and its reading is unmistakable: the global system is trembling.