Gold surged to a record high above $5,100 an ounce on Monday, extending a historic rally as investors piled into the safe-haven asset amid rising geopolitical uncertainties.

Spot gold were up 2.2% at $5,089.78 per ounce by 0656 GMT, after earlier touching an all-time high of $5,110.50. US gold futures for February delivery also gained the same amount to $5,086.30 per ounce.

The metal soared 64% in 2025, its biggest annual gain since 1979, driven by safe-haven demand, US monetary policy easing, robust central bank purchases including China's fourteenth straight month of buying in December, and record inflows into exchange-traded funds.

Prices have set consecutive record peaks over the past week and have already risen more than 18% this year.

The latest catalyst "is effectively this crisis of confidence in the US administration and US assets, that was set off by some of the erratic decision-making from the Trump administration last week", said Kyle Rodda, a senior market analyst at Capital.com.

US President Donald Trump abruptly stepped back on Wednesday from threats to impose tariffs on European allies as leverage to seize Greenland.

Over the weekend, he said he would impose a 100% tariff on Canada if it followed through on a trade deal with China.

He has also threatened to hit French wines and champagnes with 200% tariffs in an apparent effort to pressure French President Emmanuel Macron into joining his Board of Peace initiative. Some observers fear the board could undermine the United Nations' role as the main global platform for conflict resolution, though Trump has said it will work with the UN.

"This Trump administration has caused a permanent rupture in the way things are done, and so now everyone's kind of running to gold as the only alternative," Rodda added.

Meanwhile, a rising yen dragged the dollar broadly lower on Monday, with markets on alert for possible intervention in the yen and investors cutting dollar positions ahead of this week's Federal Reserve meeting.

A weaker dollar makes greenback-priced gold more affordable for holders of other currencies.

Analysts expect gold prices to climb further toward $6,000 this year on mounting global tensions as well as strong central-bank and retail demand.

"We expect further upside (for gold). Our current forecast suggests that prices will peak at around $5,500 later this year," said Philip Newman, director at Metals Focus.

"Periodic pullbacks are likely as investors take profits, but we expect each correction to be short-lived and met with strong buying interest," Newman added.

Spot silver advanced 4.8% to $107.903, after hitting a record of $109.44. Spot platinum climbed 3.4% to $2,861.91 per ounce, after hitting a record high of $2,891.6 earlier in the session, while spot palladium was 2.5% higher at $2,060.70, having touched a more than three-year high.

Silver climbed above the $100 mark for the first time on Friday, building on its 147% rise last year as retail-investor flows and momentum-driven buying compounded a prolonged spell of tightness in physical markets for the metal.