Investors’ rally around gold a ‘textbook’ safe haven move

Yasmine Raso

Senior Journalist

25 March 2026

Investors have moved quickly to reap the ‘safe haven’ rewards offered by gold amid ongoing market volatility fuelled by the tensions in the Middle East, but at the same time have triggered a short-term correction.

Matt Bance, solutions strategist and portfolio manager on the Multi-Asset Solutions team at T. Rowe Price, said markets were quick to “reframe the episode” and put a cap on the asset’s momentum.

“Rather than a sustained geopolitical shock, investors have treated it more as an energy-driven inflation event. That shift has pushed real yields higher, strengthened the US dollar, and reduced expectations for rate cuts, all of which are typically negative for gold.

“At the same time, positioning has played a role. Gold had already performed strongly coming into this period, limiting the scope for fresh safe-haven inflows. Instead, investors have used the volatility to take profits and reduce exposure across previously strongperforming
assets.”

Bance noted that investors appetite for gold remains buoyed by central bank demand and also points to the asset as a “strategic allocation” designed for long-term performance.

“Looking ahead, gold is likely to remain sensitive to a mix of macro and geopolitical drivers. The path of real yields and central-bank policy expectations will be key in the near term, alongside the trajectory of energy prices and the US dollar.

“A more prolonged or disruptive energy shock could shift the environment towards stagflation, a backdrop that has historically been more supportive of gold.

“From an investment perspective, we continue to see gold as a strategic allocation rather than a short-term trade.

“Structural demand from central banks and ongoing policy uncertainty provides a strong underpinning, even if price action remains volatile in the near term.