Gold prices reached a new record high on Monday as investors rushed to the safe-haven metal. The surge came after U.S. President Donald Trump announced fresh trade tariffs on commodity imports. Despite a stronger U.S. dollar, gold demand soared.
At 3:30 p.m. ET (20:30 GMT), spot gold climbed 1.5% to $2,904.19 an ounce. Earlier, it touched a record high of $2,911.44. Meanwhile, April gold futures rose 1.6% to $2,933.61 per ounce.
The latest move by Trump sparked fears of an escalating trade war. He imposed a 25% tariff on all aluminum and steel imports to the U.S. This policy heightened concerns over global trade stability. Additionally, he introduced reciprocal tariffs to match duties imposed by other nations.
These trade measures followed the recent 10% tariffs against China. In response, Beijing retaliated with its own trade restrictions. Analysts fear that worsening trade relations could slow global economic growth.
“Gold is already up over 10% year-to-date, reaching multiple record highs. Investors seek safe-haven assets amid inflation risks and economic uncertainty,” analysts at ING noted.
Other precious metals also recorded gains. Silver futures inched up 0.1% to $32.468 per ounce, while platinum futures increased 1.3% to $1,034.40 per ounce. These metals often follow gold’s lead in times of market instability.
The trade war concerns also impacted industrial metals. London Metal Exchange benchmark copper futures remained flat at $9,468.00 per ton. However, March copper futures gained 2.4% to $4.7008 per pound.
“With Trump back in office, trade uncertainty remains high. Prolonged trade disputes could weaken global demand for industrial metals,” ING analysts stated.
In 2018, the U.S. imposed a 10% tariff on aluminum and a 25% tariff on steel. These duties aimed to boost domestic production. Later, tariffs on Canada and Mexico were lifted under a new trade agreement.
Investors now turn their attention to Federal Reserve Chair Jerome Powell. He is set to testify before Congress on monetary policy. His remarks will likely address the economic impact of Trump’s tariffs.
Moreover, upcoming U.S. consumer price index (CPI) inflation data could influence interest rate expectations. Some analysts warn that tariffs may drive inflation higher, limiting the Fed’s ability to cut rates.
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Gold prices hit a new record high as Trump’s trade tariffs boost safe-haven demand. Learn why gold is surging.
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