Gold Prices Hit Two-Week High Amid Tariff Concerns
Gold prices rose to a two-week high on Tuesday as concerns over U.S. President Donald Trump’s tariff plans boosted interest in the safe-haven metal. Investors are also awaiting the Federal Reserve policy meeting scheduled for Wednesday.
As of 0632 GMT, spot gold gained 0.9% to $3,362.69 an ounce, after hitting its highest level since April 22 earlier in the session. U.S. gold futures climbed 1.5% to $3,370.40.
IG market strategist Yeap Jun Rong commented, “Gold prices have a strong run-up to start this week, with investors returning to the safe-haven asset to hedge against portfolio volatility amid renewed tariff concerns from U.S. President Donald Trump.”
Recent Tariff Announcements
On Sunday, Trump announced a 100% tariff on movies produced overseas, but provided few details on how such a levy would be implemented. On Monday, he indicated that he plans to announce pharmaceutical tariffs within the next two weeks.
Upcoming Federal Reserve Meeting
The Fed’s interest rate decision and comments from Fed Chair Jerome Powell on Wednesday are being closely monitored for indications of the central bank’s rate trajectory. The Fed has maintained its policy rate in the 4.25%-4.50% range since last December.
“Any dovish signals could provide further support for gold, reinforcing its broader upward momentum,” Rong added.
While the Fed is expected to leave rates unchanged on Wednesday, the meeting may mark a pivotal moment with Trump’s tariffs creating uncertainty over the economic outlook, according to a report by Reuters.
Goldman Sachs forecasts that “Fed officials will want to see evidence from the labor market and other hard data before cutting. We expect three 25 basis point cuts in July, September, and October.”
Market Performance of Other Precious Metals
The non-yielding bullion, a safeguard against political and financial turmoil, typically thrives in a low interest rate environment. Other precious metals also saw gains:
- Spot silver rose 1.5% to $32.98 an ounce.
- Platinum climbed 1.4% to $972.25.
- Palladium advanced 0.5% to $945.25.
