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AzerNEWS Staff

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Gold, traditionally regarded as a safe-haven asset, has experienced a complex and volatile trajectory in early 2026, shaped by competing macroeconomic forces, geopolitical risks, and liquidity dynamics, AzerNEWS reports.

The price of one troy ounce of gold rose to $4,694.20 on the COMEX Commodity Exchange in New York.

According to market data, geopolitical tensions have intensified inflationary risks and contributed to heightened investor anxiety. Historically, such conditions have supported gold prices, reinforcing its role as a hedge against uncertainty.

However, the narrative shifted sharply in March 2026. Gold had begun the year with a bang, rising 12.42% in January – its best monthly performance since November 2009 – and 8.9% in February, giving it a seven-month winning streak for the first time in 53 years.

The central banks of the world continue to increase the share of gold in reserves at the expense of dollar assets, a trend that has been gaining momentum since 2015.

Several key factors contributed to gold’s decline. The strengthening of the US dollar played a central role, as investors sought liquidity and safety in dollar-denominated assets. A stronger dollar makes gold more expensive for holders of other currencies, dampening global demand. Treasury yields have increased the opportunity costs of owning non-profitable assets such as gold, prompting investors to rebalance their portfolios.

Despite short-term volatility, the longer-term outlook for gold remains supported by structural factors. In 2025, gold prices rose by 64%, driven by sustained safe-haven demand, accommodative US monetary policy, and strong central bank purchases.

Azerbaijan has also benefited from favorable market conditions. In January–February 2026, the country exported gold worth $60.7 million, marking a 51% increase compared to the same period last year.

While geopolitical tensions and inflation risks continue to provide underlying support, factors such as a strong US dollar, rising bond yields, and liquidity pressures can temporarily undermine prices. It is important for investors to understand these dynamics in order to navigate the increasingly complex global economic situation.