(Reuters)

Gold prices surged past $3,100 per ounce to a fresh record high on Monday, as worries about potential inflation pressures due to U.S. tariffs put the safe-haven asset on track for its strongest quarter since 1986.

Spot gold rose 1.1% to $3,117.29 per ounce by 1307 GMT, having hit a record $3,128.06 earlier. U.S. gold futures were up 1.2% at $3,151.10.

Bullion has gained around 18% so far this year, after rising more than 27% in 2024, supported by a favourable monetary policy backdrop, robust central bank buying and demand for exchange-traded funds, among other factors.

Gold’s Relative Strength Index stands above 77, indicating the market is overbought, but analysts said the momentum has defied any standard logic of where prices are positioned.

“Gold’s bull run is the reflection of the anxiety around tariffs. The fears that these tariffs are going to be growth-constraining, potentially leading to lower economic outcomes”, is supporting gold, said Nitesh Shah, commodities strategist at WisdomTree.

U.S. President Donald Trump is expected to announce reciprocal tariffs on April 2, while automobile tariffs will take effect on April 3.

Goldman Sachs last week raised its end-2025 gold price forecast to $3,300 per ounce from $3,100. Under extreme market conditions, bullion could climb above $4,200 per troy ounce by the end of 2025 and potentially surpass $4,500 within the next 12 months, it said.

Bank of America also increased its gold forecasts last week, and now expects the yellow metal to average $3,063 per ounce in 2025 and $3,350 per ounce in 2026.

“Gold prices could be trading around $3,500 about this time next year and that reflects sentiment towards the metal remaining strong, primarily with all the geopolitical risks still there,” Shah said.

Trump said on Sunday he was “pissed off” at Russian President Vladimir Putin and would impose secondary tariffs of 25%-50% on buyers of Russian oil if he feels Moscow is blocking his efforts to end the war in Ukraine.

Spot silver dropped 0.4% to $33.96 an ounce, platinum was up 0.8% at $991.55 and palladium gained 0.8% to $979. All three metals were headed for monthly gains.