Gold tops $5,300 as weak dollar ‘supercharges’ rally

Gold (GC=F) futures jumped above $5,300 per ounce on Wednesday before easing as a weak dollar fueled the debasement trade, driving investors away from fiat currencies and government bonds.

The US dollar stabilized on Wednesday after sliding to its lowest level in nearly four years as President Trump shrugged off concerns of an easing greenback.

A weaker dollar has helped drive the price of bullion higher, extending year-to-date gains to 20%.

“Dollar weakness is supercharging the rise in gold….adding fuel to the fire for the crazy rise in precious metals,” said Robin Brooks, senior fellow at the Brookings Institution.

Expectations of easier Fed policy may also be contributing to the debasement trade, in which investors buy hard assets to protect purchasing power from eroding fiat currencies.

“Unchecked fiscal debt creation continues to erode confidence in fiat currencies,” Ole Hansen, head of commodity strategy at Saxo Bank, said in a note on Wednesday.

Hansen also pointed to growing odds on on Polymarket that President Trump’s next pick for Fed chair could be Rick Rieder, BlackRock’s head of global fixed income, who favors aggressive rate cuts.

The Federal Reserve is expected to keep interest rates steady Wednesday at the conclusion of its two-day policy meeting.

Geopolitical tensions are helping drive the bullion rally, with central banks maintaining strong demand while reducing exposure to government bonds.

On Wednesday, President Trump said a “massive Armada is headed to Iran,” threatening military action unless Tehran agrees to negotiate.

“Hopefully Iran will quickly ‘Come to the Table’ and negotiate a fair and equitable deal – NO NUCLEAR WEAPONS – one that is good for all parties,” Trump wrote on Truth Social.

Elsewhere in the metals space, silver jumped to $112 per ounce Wednesday before paring gains. The metal has surged 48% since the start of the year in a fast rally. Strong demand from China and restrictions on silver exports have also helped lift prices.

Meanwhile, platinum (PL=F) hovered near record highs Wednesday, gaining 29%. Copper (HC=F) prices were steady after topping $13,000 for the first time in London last week.