Gold prices climb over 1% as Trump hikes China tariffs
Shafaq News/ Gold rose more than 1% on Thursday as investors flocked to
safe-haven bullion after the US hiked tariffs on China, the top metals
consumer, escalating the already heated trade war, despite a 90-day pause on
tariffs for other countries.
Spot gold was up 1.5% at $3,129.33 an ounce, as of 0514 GMT. In the previous
session, bullion recorded its best day since October 2023. US gold futures
climbed 2.2% to $3,145.80.
US President Donald Trump said on Wednesday that he would raise the tariff
on Chinese imports to 125% from 104%. The world's two largest economies have
engaged in a series of tit-for-tat tariffs over the past week.
However, Trump decided to temporarily
lower the hefty duties he recently imposed on several countries. "If we
enter a slow growth period, which is our base case, we think rates will
eventually head lower and push gold higher since inflation worries will still
be with us for much of the year due to tariff impacts," Marex analyst
Edward Meir said. "Eventually we do see $3,200 possibly by month-end, if
not earlier."
Gold, a hedge against global uncertainties and inflation, has risen more
than 18% in 2025, driven largely by Trump's tariff plans, expectations of
interest rate cuts by the Federal Reserve, geopolitical tensions in the Middle
East and Ukraine, strong central bank buying, and increased investments in
gold-backed exchange-traded funds.
According to minutes from the Fed's latest meeting, policymakers were nearly
unanimous last month in warning that the US economy faced risks of higher inflation
alongside slower growth, with some noting "difficult tradeoffs" may
lie ahead. Non-yielding bullion stands to lose its appeal if inflationary
pressures force the Fed to keep interest rates higher.
Traders now await data from the US Consumer Price Index, due later in the day, and the Producer Price Index print on Friday. Spot silver gained 0.6% to $31.21 an ounce, platinum lost 0.3% to $935.54, and palladium shed 1% to $922.00.
(Reuters)
