On Monday, gold once again notched a new record high. A cluster of global geopolitical flashpoints, together with persistent worries about the Fed’s independence, pushed spot gold into a strong uptrend for a third straight session. Gains have continued to build, and prices are currently consolidating near their historic peak, holding on to most of the recent advance.

From a fundamental perspective, the dense outbreak of geopolitical conflicts has become the main engine behind safe-haven flows into gold. US military intervention in Venezuela has destabilised the situation in South America, with the US President even declaring himself “acting president” of Venezuela and signalling plans to oversee the country’s political transition, further heightening regional uncertainty.

At the same time, the Trump administration is weighing punitive measures in response to the Iranian government’s crackdown on anti-government protests. Combined with an escalation in the Russia–Ukraine conflict, tensions in both the Middle East and Eastern Europe continue to rise. The White House’s insistence on pushing ahead with plans to acquire Greenland is also disrupting the global order, reinforcing gold’s role as a core safe-haven asset.

Fed Chair Jerome Powell recently revealed that he has been threatened with criminal prosecution by the Trump administration, following a grand jury subpoena related to his testimony on the renovation of the Fed’s headquarters. In his public response, Powell stressed that interest-rate decisions are made in the public interest rather than under political pressure. However, if the investigation undermines central-bank independence, it could upend the current framework for monetary policy.

These concerns have pushed the US Dollar Index lower from its 5 December high, with capital flowing steadily into non-yielding gold and further amplifying its safe-haven premium. As investors sell the dollar, they are also dumping US Treasuries, sending yields sharply higher across the curve with the exception of the 2-year note.

US employment data released last Friday painted a mixed picture. The December unemployment rate fell to a relatively low 4.4%, but nonfarm payrolls rose by just 50,000, undershooting expectations. On top of that, October and November payrolls were revised down by a combined 76,000, making an already modest jobs picture look even weaker. As a result, dollar bulls failed to gain traction, and gold, driven largely by sentiment, has continued to dominate.

Market commentary:

On the 4-hour chart, gold is consolidating near the highs in a tight range, and the key driver this week will be the US CPI release: if inflation prints weaker than expected, it should reinforce market expectations for Fed rate cuts and provide the momentum for gold to decisively clear the 4,600 level and extend its rally, whereas a stickier-than-expected reading could cap easing expectations in the near term and trigger a technically driven pullback in prices.