Gold hit a new high on Tuesday and bitcoin broke through the $90,000 threshold as anxiety over the US dollar’s strength sent investors looking for other safe havens.
With President Donald Trump’s tariff policies throwing markets into turmoil, traditional and emerging alternatives — most notably gold and bitcoin — have rapidly gained favor.
On the New York Mercantile Exchange, gold surpassed $3,500 per troy ounce to reach a new record before retreating to around $3,426 just before noon ET as Wall Street rebounded from Monday’s sell-off.
The precious metal has soared nearly 30% since Trump returned to the White House.
“Orders from central banks and retail investors are driving a historic surge in gold,” analysts at JPMorgan noted, adding they expect gold to average $3,675 per ounce by the fourth quarter and potentially hit $4,000 by mid-2026.
Bitcoin also got a boost, climbing to nearly $91,000 — its highest level since early March — .to narrow its year-to-date loss to under 5%. Spot bitcoin ETFs also rallied, with the iShares Bitcoin Trust (IBIT) and others gaining 2.4%, after a 3% jump on Monday.
ETFs rebounded above their 50-day moving averages, boosted by $381.3 million in total inflows on Monday.
The ARK 21Shares ETF (ARKB) led with $116.1 million, followed by Bitwise (BITB) with $87.6 million, and iShares with $41.6 million.
The sharp rise in gold and bitcoin has been triggered by investor concerns over both geopolitics and domestic monetary policy.
President Trump on Monday posted a social media message suggesting the Federal Reserve should act immediately to lower interest rates, despite recent signs of slowing inflation.
Many interpreted the message as a not-so-veiled threat toward Fed Chair Jerome Powell.
Rania Gule of XS.com pointed to growing global skepticism toward the dollar.
The ICE US Dollar Index, which tracks the dollar against a basket of major currencies, fell by over 1% on Monday, making dollar-denominated assets like gold more attractive to international buyers. The greenback rose 0.45% as of noon Tuesday.
“Declining faith in the dollar is one of the key factors pushing gold higher,” Gule said.
Michael Brown, a market strategist at Pepperstone, echoed the sentiment.
“Investors are reducing exposure to US assets amid policy instability. Gold is one of the few instruments shielded from the volatility Trump can introduce with a single post.”
That instability has sparked interest not just in gold but also in bitcoin, as investors diversify away from the dollar.
The digital currency has risen sharply in tandem with gold, reflecting a broader shift in portfolio strategies.
With traditional financial assets like US equities and Treasury bonds now under pressure, many are turning to bitcoin as a hedge.
Physical gold ETF holdings are also at their highest level since 2023, and JPMorgan estimates central banks alone will purchase around 900 metric tons of bullion in 2025 after acquiring 1,045 tons in 2024 — accounting for roughly 20% of global demand.
Meanwhile, the US dollar index has dropped to its lowest level since February 2022, prompting renewed fears about the dollar’s global standing.
While a weaker dollar can benefit exports, the timing is problematic.
“We’re seeing capital flight from what were once the safest assets — US Treasuries and equities — at a moment when the economy may be tipping toward recession,” a senior economist told Investor’s Business Daily.
Compounding matters, the US posted a record $1.2 trillion trade deficit in 2024, while its net international investment position fell to -$26.2 trillion — figures Trump himself has criticized.
But his plan to reverse those numbers through steep tariffs lacks the transitional policies needed to avoid financial disruption, economists warn.
“This kind of economic whiplash,” JPMorgan’s analysts wrote, “is precisely what drives capital into alternatives like gold and bitcoin.”
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