Gold prices increased on Tuesday due to ongoing uncertainty over U.S. President Donald Trump’s tariff plans, which are raising concerns about their impact on the global economy.
Spot gold climbed by 0.6% to $3,229.93 an ounce, just short of Monday’s record high of $3,245.42. U.S. gold futures also gained 0.6%, reaching $3,246.50.
“Gold remains firm today… driven by investors’ demand for safe-haven assets as the U.S. seems to be preparing for more tariffs,” said Yeap Jun Rong, a market strategist at IG.
The U.S. is currently investigating imports of pharmaceuticals and semiconductors, considering tariffs on these sectors. This move is based on the belief that heavy reliance on foreign production in these areas poses a national security threat, as indicated in filings with the Federal Register on Monday.
Trump announced on Sunday that he would reveal the tariff rate on imported semiconductors within the next week, keeping market participants on edge.
As gold prices hit new highs recently, the upward trend is expected to continue, especially if tariff-related uncertainties persist, according to Yeap.
In response to the tariff situation, Raphael Bostic, President of the Atlanta Federal Reserve Bank, said that the ongoing uncertainty has caused the economy to “pause” and suggested that the Fed should maintain its current stance until more clarity is available.
Gold, which does not yield interest, is seen as a hedge against global uncertainty and inflation, and tends to perform well in a low-interest-rate environment.
Investments in Chinese physically-backed gold exchange-traded funds (ETFs) have surged this month, surpassing the total for the first quarter and overtaking U.S.-listed funds, according to World Gold Council data.
Other metals also showed varied movements: spot silver remained steady at $32.33 an ounce, platinum slipped 0.1% to $950.65, and palladium fell 1.1% to $945.19.
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