Gold climbed to a fresh all-time high on Tuesday, while silver hovered near record levels, as investors rushed into safe-haven assets amid an escalating geopolitical crisis over Greenland and renewed turmoil in global bond markets, particularly in Japan.
Spot gold briefly touched $4,781.19 an ounce, its highest level on record, before easing slightly. Silver rose in tandem, underscoring a broader flight to precious metals as confidence in traditional financial anchors—especially U.S. Treasurys and the dollar—showed signs of erosion.
The latest surge in haven demand was triggered by sharp geopolitical rhetoric surrounding Greenland. U.S. President Donald Trump, speaking while attending the World Economic Forum in Davos, Switzerland, reiterated his intention to take control of the Arctic island, showing no indication of backing down despite international backlash.
Greenland’s prime minister urged citizens to prepare for the possibility of a military invasion, describing it as unlikely but not impossible. The remarks intensified global anxiety, pushing investors to reassess geopolitical risk at a time when markets were already on edge.
Adding to the unease, the United States threatened tariffs on eight European countries, including Germany, France, and the UK, for opposing Washington’s stance on Greenland. The move raised fears of a new transatlantic trade conflict.
French President Emmanuel Macron sharply criticized U.S. trade policy in Davos, warning Europe against “vassalization and blood politics,” while Canadian Prime Minister Mark Carney said the rules-based international order was effectively “dead.”
The public confrontation highlighted the rapid deterioration in relations between the U.S. and its traditional allies—an erosion that has unsettled financial markets, weighed on the dollar, and strengthened demand for assets seen as stores of value.
Beyond geopolitics, a meltdown in the Japanese government bond market has amplified concerns about fiscal sustainability across major economies. The selloff has revived the so-called “debasement trade,” in which investors shun currencies and sovereign debt in favor of real assets such as gold.
“The situation in Japan is triggering fear of market-led debasement spreading globally,” said Daniel Ghali, senior commodity strategist at TD Securities. “Gold’s rally is ultimately about trust. That trust has bent, but it hasn’t broken. If it does, the momentum could last much longer.”
As of 7:59 a.m. in Singapore, spot gold was up 0.3% at $4,775.40 an ounce, while silver gained 0.3% to $94.89. The Bloomberg Dollar Spot Index slipped another 0.1%, extending losses after a 0.5% drop over the prior two sessions. Platinum edged lower, while palladium was little changed.
The turmoil has reignited fears of a renewed “Sell America” trade, a scenario in which international investors dump U.S. assets in response to political risk, policy volatility, or retaliation against Washington’s trade stance.
Major U.S. stock indexes slid sharply as investors fled risk assets. Around midday Monday, the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite were each down more than 1%. Of the S&P 500’s 11 sectors, only energy was trading higher.
Stress was also evident in Treasury and currency markets. The yield on the 10-year U.S. Treasury jumped above 4.3%, the highest level since early September, signaling falling bond prices. At the same time, the U.S. dollar index dropped nearly 1% to around 98.5, reflecting waning confidence in the greenback.
The dollar’s slide and the surge in yields echoed market reactions seen during President Trump’s most aggressive tariff threats last year, when investors questioned the stability and predictability of U.S. economic policy.
Market anxiety was further reflected in a spike in volatility. The Cboe Volatility Index (VIX) surged to as high as 20.69, its highest reading since late November. A VIX level above 20 is widely viewed as a signal of elevated fear on Wall Street.
Trump’s second term has been marked by repeated bouts of market turbulence. The VIX soared above 30 in early March after the administration imposed tariffs on Canada, China, and Mexico, and climbed above 40 a month later following the announcement of sweeping “reciprocal tariffs.” Subsequent tariff threats, geopolitical developments, and concerns over an AI-driven market bubble kept volatility elevated through much of 2025.
“There is a limit to how many things you can put on the table before one of them spins out of control,” UBS CEO Sergio Ermotti said in an interview at Davos. The relentless flow of disruptive headlines, he noted, is “starting to weigh on customer sentiment,” prompting more investors to diversify their portfolios.
Analysts warn that President Trump’s actions risk undermining global confidence in the U.S. dollar and Treasurys—two pillars of the international financial system. If foreign investors continue to retreat from U.S. assets, America could gradually lose some of the advantages derived from its currency’s dominant global role.
For now, gold’s record-breaking rally reflects a world grappling with geopolitical fracture, fiscal strain, and declining trust in long-standing economic institutions—conditions that continue to favor havens over risk.
