Gold Edges Lower as Caution Takes Hold Before Trump Grabs Helm
Gold edged lower, with many traders cautious that Donald Trump’s inauguration as US president later Monday could herald an era of sweeping tariffs, trade wars, and widespread market upheaval.
The precious metal traded near $2,695 an ounce, after clocking up a third weekly gain. It was boosted last week by softer-than-expected US inflation that saw investors reboot bets on the Federal Reserve easing rates further this year. Looser monetary policy is positive for gold as it doesn’t pay interest.
Investors are also concerned about the new president’s immigration policy and scope for sharper geopolitical tensions, with Trump already taking aim at some traditional US allies including Canada, Mexico and Europe. While that could boost gold’s value as a haven, it may also lift the US dollar, presenting a headwind.
Gold set a series of records last year as the Fed pivoted toward rate cuts and heightened geopolitical tensions drove haven demand. Central-bank buying has also been a key driver, with 97% of institutions expecting to maintain or raise gold reserves this year, according to a survey by the World Gold Council.
In the Middle East, meanwhile, a long-delayed ceasefire in the Gaza war began taking hold as Hamas released three female hostages in exchange for 90 Palestinians held in Israeli prisons.
Spot gold was down 0.3% at $2,695.31 an ounce at 8:38 a.m. in Singapore, after a weekly gain of 0.5%. The Bloomberg Dollar Spot Index advanced 0.1%. Silver, palladium and platinum all dipped.
Source : Bloomberg
