Gold had a stellar start in 2025, making Q1 the metal’s second-best quarter after Q3 in 1986. Gold has long been viewed as a safe-haven investment, especially during times of political and economic turmoil. As fears of a global trade war escalate and concerns mount over a likely U.S. recession, gold prices have surged, reaching new heights.

Gold has already hit over a dozen record highs this year. Gold bullion exchange-traded fund SPDR Gold Trust (GLD Quick QuoteGLD - Free Report) advanced 28.6% so far this year (as of April 21, 2025) and surged 46.4% over the past one year.

Has Gold Hit Its Peak?

Some market analysts believe that gold may be nearing its top.

“We’re probably close to maximum optimism on gold at this point,” said Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute. He cautions that investors chasing gold now may regret it later, as quoted on CNBC.

The GLD ETF’s relative strength index (14) stands at 77.317, signaling its overbought. The party may be over anytime soon.  

Tariff Tensions Fuel the Rally

President Donald Trump recently imposed steep tariffs on imports, targeting specific countries. While the implementation was delayed by 90 days, the trade war between the U.S. and China continues to escalate. So far, the United States enacted a 145% tariff on Chinese imports, prompting China to retaliate with a 125% tariff on American goods.

Diverging Analyst Opinions on Gold’s Future

While some analysts see gold nearing its peak, others believe there's more room for growth.

“Even though gold prices are at an all-time high, the reality is that in the next couple of years it could accelerate,” said Jordan Roy-Byrne, founder of The Daily Gold, as quoted on CNBC.

Gold Prices Remain Elevated but Overvalued, Says RBC

Analysts at RBC Capital Markets believe that gold remains overvalued from a macroeconomic perspective. They emphasize that recent price increases have been driven by uncertainty, and the factors creating that uncertainty are equally unstable.

Despite the potential for a correction, they note that weakening economic sentiment continues to support gold's appeal—suggesting that high prices may persist, as quoted on Kitco.

Can Gold Surge from This Already High Level?

RBC analysts argue that a further rise in gold prices would require soft economic sentiments and rumors about recession to translate into weakness in hard data. This transition could fuel a more aggressive move by investors into gold.

Hard Data Remains Resilient—for Now: Limited Score for Further Upside in Gold

Despite negative projections, actual economic data continues to show strength, particularly in the labor market. However, we know that a clear downturn in the real economy could lead the Federal Reserve to shift from its current neutral policy stance to rate cuts, which can spark a fresh rally in gold.

Stagflation Fears Grow With Rising Inflation Expectations

Consumer expectations for inflation are rising, stoking fears of stagflation. And gold is viewed as an inflation -protected assets (read: Fed Pause Amid Stagflation Risks? Smart ETF Moves to Follow).

Consolidation Could Attract Fresh Capital

In early April, RBC Capital noted that if gold enters a consolidation phase, it could create opportunities for new investors. Many investors remain favorably inclined toward gold but are reluctant to buy at all-time highs. A period of price stabilization could provide the entry point they’re waiting for.

Investing in Gold ETFs

One can gain exposure to gold via ETFs that track the price of physical gold, if gold corrects little bit. The two largest options in the market are SPDR Gold Shares (GLD Quick QuoteGLD - Free Report) , iShares Gold Trust Micro (IAUM Quick QuoteIAUM - Free Report) , SPDR Gold MiniShares Trust (GLDM Quick QuoteGLDM - Free Report) and iShares Gold Trust (IAU Quick QuoteIAU - Free Report) . Financial advisors generally recommend limiting gold exposure to about 3% of an overall investment portfolio, as quoted on a CNBC article.