Gold's strong rise continues, with the precious metal hitting a fresh record on Thursday as investors rush to shield their portfolios from mounting trade tensions and economic uncertainty.

Spot gold as tracked by the SPDR Gold Trust (GLD  ) traded at $2,969 per ounce at 10:52 a.m. ET, gaining 1.2% and marking its third consecutive session of gains. The metal surged 13% so far in 2025, outpacing every other major asset class.

The S&P 500 - tracked by the SPDR S&P 500 ETF Trust (SPY  ) - is down 5.2%, Bitcoin has lost 12% and the U.S. dollar index has slipped 4% year-to-date.

Why Is Gold Soaring?

Gold's rally is driven by a cocktail of economic and geopolitical risks. President Donald Trump's administration has reignited fears of a global trade war, by threatening countries with high tariffs.

Meanwhile, signs of economic weakness are becoming more pronounced. The Atlanta Federal Reserve's GDPNow model projects a 2.4% contraction for the U.S. economy in the first quarter of 2025, while JPMorgan has raised its probability of a recession this year to 40%.

"A large and unknown player is driving gold's recent rally," Ross Norman, CEO of Metals Daily Ltd. said. This could explain why the metal is defying normal trading patterns and pushing higher despite fluctuating bond yields and currency movements.

"As the trade war started by President Trump worsens, there is no wonder why gold continues to be one of the best-performing assets right now," veteran market strategist Ed Yardeni said.

Where Does Gold Go From Here?

With risk aversion dominating sentiment, analysts are raising their gold price forecasts. Joni Teves of UBS Investment Bank, speaking on CNBC's "Squawk Box," said, "Risk aversion created by the geopolitical landscape, particularly tariffs, is still going to work in favor of adding gold to the portfolio."

UBS expects gold to reach $3,100 per ounce by the end of the year.

Macquarie Group analysts are even more bullish, forecasting gold could hit $3,500 by the third quarter.

"We view gold's price strength to date, and our expectation for it to continue, as primarily being driven by investors' and official institutions' greater willingness to pay for its lack of credit or counterparty risk," the organization wrote.

Mining Stocks Soar On The Heels Of Gold Rally

The gold rally has breathed new life into mining stocks, though many remain well below past highs.

The VanEck Gold Miners ETF (GDX  ) jumped 3.2% but is still trading 35% below its 2011 peak. The VanEck Junior Gold Miners ETF (GDXJ  ) also gained 3.2% but remains 70% below its 2010 record.

Among individual stocks, Newmont Corp. (NEM  ) climbed 5.1%, B2Gold Corp. (BTG  ) advanced 4.8%, Kinross Gold (KGC  ) added 3.8%, Franco-Nevada Corp. (FNV  ) gained 3.1% and Barrick Gold Corp. (GOLD  ) rose 2.7%.