Mazli Noor, a fellow at the Institute of Corporate Directors Malaysia (ICDM), said the speed at which markets have taken refuge in gold has been beyond expectations.
In a post on his LinkedIn page this week, the engineer-turned-entrepreneur also noted that for the market, gold is now the single most credible hedge against global economic uncertainties.
In an earlier post, Mazli noted that Trump’s move to initiate a trade war involving highly aggressive increases in tariffs had proven to be more economically detrimental in the US than anywhere else.
“This is especially true with regards to inflation, unemployment rates, and the purchasing power of the American middle class, which has long been the backbone of the US economy,” he said.
He said that with Trump’s tariffs in place, the US dollar will no longer be the default trading currency and safe haven against a deteriorating world economic climate.
He attributed this to an increasingly mature and diverse global market along with noticeably stronger alternative structures, as seen in economic blocs such as BRICS.
On the other hand, he said, the quick retreat to gold has been beyond expectations.
The gold rush has led to record-high prices for the precious metal. Last Wednesday, the spot price of gold closed at US$3,035.12 per ounce, having reached a record high of US$3,038.90 earlier in the day.
Mazli also cited analysts’ views that this is because the market now considers gold the single most credible hedge against global economic uncertainties.
At the same time, the US dollar has underperformed badly, declining by 3% so far this year. This is the currency’s worst performance in the same period within a year since 2008, according to a report in Bloomberg.
The Bloomberg report also noted that the USD Index has deteriorated, standing most recently at 103.50 – down from 107.6 at the end of February 2025.
At its most recent meeting in February, the Federal Open Market Committee voted to keep the interest rates at 4.25%-4.5%.
While Trump, as expected, disagreed with the move, major world economies chose to keep their rates unchanged as well. Malaysia is no exception, electing to maintain its overnight policy rate at 3%.
Mazli observed that the anticipated “double whammy” on the US economy has come to pass.
“For the time being, the US seems to be out of any viable weapons to defend its already stumbling economy,” he said.
“It remains to be seen if common sense will prevail, or developments outside of the White House will help steer the economy back on more solid ground,” he added.