Gold Steady Just Below Record High as Trade War Anxiety Festers
Gold held firm just below a record high set at the opening session of the week as U.S. plans to impose more tariffs stoked investor anxiety.
Bullion was little changed near $3,211 an ounce, after peaking above $3,245 on Monday, before ending slightly lower. The Trump administration has opened investigations into semiconductor and pharmaceutical imports, paving the way for the levies.
The precious metal has risen more than a fifth this year as the worsening trade war has dampened global growth prospects, eroded confidence in traditionally safe U.S. assets including Treasury bonds and roiled financial markets. Treasury Secretary Scott Bessent played down the recent selloff in the bond market, while noting that his department has the tools to address the dislocation if needed.
Federal Reserve Chairman Christopher Walker, meanwhile, said the inflationary impact of the trade war would be temporary, with interest rate cuts “very likely” in the second half. Lower borrowing costs typically help gold, which pays no interest.
Leading banks remain optimistic about bullion’s prospects over the coming quarters as investors add to holdings in bullion-backed exchange-traded funds and central banks continue to accumulate the metal. Goldman Sachs Group Inc. has forecast that prices will rise to $4,000 an ounce by mid-2026.
Gold could also draw support from strong demand in China, the world’s largest bullion market. As the trade war has escalated, there has been a surge in speculative trading, as well as inflows into local ETFs.
Gold was little changed at $3,211.90 an ounce as of 8:27 a.m. in Singapore. The Bloomberg Dollar Spot Index was steady after a five-day decline that pushed the index to its lowest since October. Silver fell, and palladium and platinum were flat.
Source: Bloomberg
