Gold Set for Weekly Gain as U.S. Tariffs Fuel Higher Demand for Precious Assets
Gold is on track for a weekly gain, as traders seek higher-yielding assets after new U.S. tariffs hit markets and added to uncertainty about the economic outlook.
Bullion prices eased slightly on Friday to trade near $2,905 an ounce, up 1.7% so far this week. There have been growing concerns over U.S. President Donald Trump’s move to impose the biggest tariff increase in a century, which has prompted retaliation from some countries and kept investors on guard.
Economists largely anticipate the levies will lead to potentially higher prices for consumers and slower growth — posing a challenge to the Federal Reserve’s dual mandate of trying to promote price stability and maximum employment. Lower interest rates tend to benefit the precious metal, since it doesn’t pay interest. However, Trump eased some concerns this week by suspending Mexican and Canadian goods covered by the North American trade agreement from 25% tariffs, offering a reprieve to the country’s two largest trading partners.
Traders will look ahead to Friday’s nonfarm payrolls data for further signs of a slowing labor market, which would raise the odds of more Fed rate cuts.
Spot gold fell 0.2% to $2,905.45 an ounce by 8:42 a.m. in Singapore. The Bloomberg Dollar Spot Index was steady, after its longest decline since September. Silver and palladium fell, while platinum was flat.
Source: Bloomberg
