Gold price pulls back after surge towards $5,600

[Ben Graham]

Gold prices retreated on Thursday during what was its most volatile trading session in three months, as some investors booked profits to cover losses in other assets.

Spot gold initially edged higher to set a new record of $5,594.34 per ounce but later fell as much as 6% to the $5,100 level — its sharpest decline since October. By midday, it had pared some losses to settle at above $5,300 per ounce, down more than 1% on the day.

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Other metals also took hits, with silver falling more than 6% and copper losing most of its gains.

“It just seems like we’ve hit some peak euphoria,” Phil Streible, chief market strategist at Blue Line Futures, told Bloomberg, referring to gold’s red-hot start to the year.

During the first four weeks of 2026, bullion has already gained by about a quarter, tracking towards its best monthly performance in over 50 years.

GRAPHIC: Gold price has more room to run, analysts say

“Given the frothiness in the markets and the dominance of flows over fundamentals, it does not need much for a correction,” said Julius Baer Group’s Carsten Menke.

Gold’s rise has been fueled by heightened geopolitical tensions and worries over the independence of the US Federal Reserve. The yellow metal tends to thrive during times of uncertainty, for its role as a store of value.

However, Ewa Manthey, commodity strategist at ING Bank, noted that gold is now being treated less as a safe haven and more as a source of liquidity, which led to the latest drawdown.

(With files from Bloomberg)