A global surge in gold demand saw prices reach unprecedented levels earlier this week, sparking a worldwide scramble as individuals either offload existing precious metal or dive into the burgeoning market.
Consumers are flocking to local merchants to convert golden jewellery into cash, while others are making their first foray into purchasing gold coins or bars. A growing number are also channelling funds into investment vehicles such as exchange-traded funds, which track the metal’s value much like traditional stocks.
New York spot gold soared to a record high of over $5,418 per troy ounce on Wednesday, the standard measure for precious metals. However, prices have since retreated, with futures dipping below the $5,000 mark by Friday afternoon, potentially indicating a wider market correction. This increased volatility became particularly pronounced following reports that President Donald Trump intended to nominate former Federal Reserve official Kevin Warsh as the next chair of the U.S. central bank.
Despite gold’s inherent volatility and unpredictable nature, current prices remain significantly elevated compared to a year ago, when New York spot gold traded at less than $2,795 a troy ounce. This stark contrast underscores the dramatic shift in the precious metal’s market dynamics.
What drives surges in gold prices
A lot of it boils down to uncertainty. Interest in buying gold — and other precious metals, like silver — typically spikes when investors become anxious.
Gold prices climbed worldwide at the height of the COVID-19 pandemic and amid ongoing wars and turmoil from Trump’s tariffs on foreign goods. The latest records coincide with escalating geopolitical tensions in Venezuela and Iran, Trump’s repeated calls for the U.S. to take over Greenland and his increasingly combative stance towards America’s allies.
There’s been “a real rupture in the way we think about how the world order, if we want to call it that, functions,” said Daniel McDowell, a professor of political science at Syracuse University. In moments of instability, he explains, buying gold has historically been a sort of “psychological reaction” for some hoping to find a safe place for their money.
The latest rush for gold also corresponded with a weakening U.S. dollar and questions about the Fed’s future independence.
Rising demand for merchants
More jewelry sellers and precious metal dealers are seeing an uptick in customers looking to buy or sell gold.
The boom is tangible in Paris’ historic district for dealers of gold, silver and coins. Traders at Godot & Fils say they have a flow of customers from open to close, amounting to about 100 transactions per day.
Annick Le Toulleca, 76, came in to sell broken jewelry she kept for years. “Even keeping money in the bank feels a bit risky,” she told The Associated Press. Others were buyers. After purchasing a gold coin, Christophe Thooris, 53, said he decided to convert some cash into gold in hopes of protecting his savings.
Worldwide, people may encounter some “sticker shock” due to recent price hikes. Swings in value have also strained sellers — particularly for products also impacted by new tariffs.
Larger retailers like Pandora and Signet, which owns Zales and Kay Jewelers, acknowledged the headwinds of both tariffs and rising costs for gold (as well as silver) in 2025 earnings calls.
Higher gold prices primarily impact products like gold chains. In contrast, experts point to falling diamond costs.
Joshua Barone, a principal wealth manager at Savvy Advisors, notes that lab-grown diamonds have rapidly brought down average prices in recent years. As a result, many pieces of jewelry with those gems have “actually become cheaper in the stores,” he adds.
If I own gold, is it a good idea to sell?
It depends on your personal situation and whether you’re willing to part with gold you own. But experts like Barone suggest it might be good to wait a bit. Prices could rise if uncertainty deepens, or potentially peak depending on future geopolitical developments.
Still, the future isn’t promised. And again, many consumers are selling now.
If you’re selling, make sure you’re finding a reputable dealer. Barone says he personally prefers working with local, in-person dealers, because he doesn’t “like the idea of mailing precious metals.” Still, he knows some people have good experiences online. Experts suggest reading reviews or ratings through groups like the Better Business Bureau, or checking with trusted trade associations.
You’ll also want to compare “spreads,” or the difference in price offered when you buy vs. the money you get when you sell — as well as processing times.
What about buying now?
If you want to buy gold, consider what you can afford and how long you’re willing to hang on to it. Advisors generally say that longer investments, such as keeping gold for 10 or more years, are less risky than trying to jump into the market for a quick profit.
Again, precious metals can be volatile, with daily losses like that seen on Friday. While prices are still up significantly over the past year, they could fall again in a wider correction.
While advocates of investing in gold argue that it helps people hedge against inflation and diversify investment portfolios, experts still caution against putting all your eggs in one basket. And not everyone agrees gold is a good investment. Critics say other derivative-based investments may be a better bet.