Gold prices surged to their highest intraday level since early November, as traders assessed the global economic outlook with President Donald Trump’s ongoing trade and immigration policy developments. Bullion rose to approximately $2,754 per ounce after gaining 1.4% in the previous session, as Trump’s tariff threats spurred increased demand for safe-haven assets. The President signaled that he was considering a 10% tariff on Chinese goods in retaliation for fentanyl flows, and reiterated plans to impose import duties of up to 25% on Canada and Mexico in the near future.
Market participants are closely watching the effects of the Trump administration’s tariff and tax cut policies, which may strain the nation’s finances and reignite inflation. This could complicate the Federal Reserve’s ability to continue easing monetary policy, as higher borrowing costs generally act as a drag on gold prices due to its lack of interest yield.
Gold achieved a series of milestones in 2024, with its price gains driven by the Fed’s shift to looser monetary policy, rising geopolitical tensions, and significant central bank buying. The precious metal could receive additional support from growing demand for safe-haven assets amid concerns over the new president’s immigration policies and the potential for escalating tensions between the U.S. and other nations.
At 6:12 a.m. in London, spot gold rose 0.3% to $2,754.04 per ounce. The Bloomberg Dollar Spot Index showed little movement, while silver, platinum, and palladium also saw price increases.
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