By: Economy Middle east

Gold prices entered uncharted territory on Tuesday as the precious metal decisively broke through the psychological $5,100 barrier. Driven by a volatile mix of geopolitical tensions in the Middle East, aggressive U.S. tariff rhetoric, and a weakening dollar, bullion has firmly established itself as the ultimate hedge in a rapidly shifting global economy.

Spot silver surged 4 percent to $109.87 an ounce after reaching a record high of $117.69 on Monday. The white metal has already climbed 53 percent this year.

The momentum that defined the start of 2026 has intensified, with Tuesday’s session witnessing record-breaking activity across major exchanges. Spot gold prices climbed more than 1 percent on Tuesday, hovering around $5,082.17 per ounce and touching an intraday all-time high of $5,110.50. This surge marks a historic year-on-year increase of over 80 percent. On the COMEX, U.S. gold futures for February delivery also tracked these gains, peaking at $5,117. The move comes as investors digest the implications of potential Federal Reserve rate cuts later this year, which typically boost non-yielding assets like gold.

Reflecting the dramatic movements in international benchmarks, the retail market in the United Arab Emirates saw a substantial jump on Tuesday. The “City of Gold” adjusted its rates to reflect the surging global spot price, pushing local valuations to levels never seen before. 

In the UAE, gold rates surged, with 24-carat gold rising AED7.00 to AED610.50 and 22-carat gold edging up AED6.50 to AED565.25. Additionally, 21-carat gold increased by AED6.25 to AED542.00, while 18-carat gold added AED5.25 to reach AED464.50.

Gold’s triple growth engine

Several major factors have converged to propel gold into this new “price discovery” phase. First, the “Tariff Factor” and trade uncertainty have resulted in global markets reacting to the administration’s aggressive trade stance. Threats of high tariffs on major trading partners—including a potential 100 percent duty on certain goods—have reignited fears of a global trade war, which has funneled capital away from equities and into the perceived safety of bullion. Second, geopolitical escalation remains a concern, particularly in the Middle East, where the presence of a U.S. naval carrier group and renewed warnings regarding Iran’s nuclear program have added a significant “risk premium” to commodities. Finally, central bank accumulation continues to be the backbone of this rally, with institutions, led by emerging economies, diversifying away from the U.S. dollar at a record pace. Reports indicate that global central banks are now purchasing an average of 70 tons of gold per month, providing a massive floor for the market.

Analyst outlook: Is $6,000 the next target?

With the $5,000 level now in the rearview mirror, analysts are looking at higher resistance zones. Some aggressive forecasts suggest that if the U.S. Federal Reserve moves forward with its anticipated 150 basis points of rate cuts through 2026, gold could approach $6,000 per ounce by the fourth quarter. “We are witnessing a historic global wealth re-pricing,” noted one senior commodities strategist. “The combination of fiscal concerns and geopolitical instability has made gold the essential asset for institutional portfolios.” For technical traders, the new support level to watch is $5,050. As long as gold holds above this mark, the bullish trend remains firmly intact. However, some profit-taking is expected following such a rapid ascent, which may lead to brief periods of consolidation.