Gold Prices Reach 11-Week High as Safe-Haven Demand Rises Amid Trump’s Tariff Threats
Gold prices climbed to an 11-week high during Asian trading on Wednesday, driven by increasing safe-haven demand amid concerns over U.S. tariff policies under President Donald Trump.
Spot gold rose 0.2% to $2,749.29 per ounce, its highest since early November, while February gold futures gained 0.2% to $2,766.57 an ounce as of 01:45 ET (06:45 GMT). This marked the third consecutive session of gains for the precious metal.
Safe-Haven Appeal Amid Global Uncertainty
Gold, traditionally viewed as a safe-haven asset, continues to attract investor interest as global markets brace for potential economic disruptions stemming from Trump’s tariff threats. The metal’s rise reflects ongoing caution over the president’s policy announcements, which are expected to fuel inflation. Gold is often seen as a hedge against inflationary pressures.
On Tuesday, Trump hinted at the possibility of imposing 10% tariffs on Chinese imports starting February 1. He also pledged to introduce tariffs targeting the European Union, heightening concerns about escalating trade tensions.
Dollar Dynamics and Gold Prices
The U.S. Dollar Index rose 0.2% in Asian trade on Wednesday, recovering from Monday’s sharp 1% drop, when Trump avoided providing details on tariffs. A stronger dollar generally pressures gold prices by making the metal more expensive for buyers using other currencies. However, gold has managed to maintain its momentum, bolstered by safe-haven demand despite the dollar’s partial recovery.
Muted Performance of Other Precious Metals
While gold showed strength, other precious metals remained stable:
• Platinum futures held steady at $968.45 per ounce.
• Silver futures traded unchanged at $31.51 per ounce.
Copper Prices Decline on Tariff Concerns
Copper prices continued their downward trend, weighed down by fears of U.S. tariffs and a potentially stronger dollar. Historically, escalating trade tensions have dampened demand for copper, particularly from China, the world’s largest consumer of the metal.
• Benchmark copper futures on the London Metal Exchange fell 0.6% to $9,232.50 per ton.
• February copper futures dropped 0.9% to $4.3015 per pound.
The combination of anticipated tariffs and reduced industrial demand underscores the cautious outlook for copper in the near term.
Outlook
Gold’s recent gains underscore its role as a safe haven in times of uncertainty. Traders will closely watch Trump’s upcoming policy decisions, particularly on tariffs, to gauge their impact on inflation and the broader market dynamics. Meanwhile, other metals, such as copper, may face continued pressure as trade tensions and dollar fluctuations shape global demand.
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Disclaimer: This text constitutes marketing communication. It is not any form of investment advice or investment research or an offer for any transactions in financial instrument. Its content does not take into consideration individual circumstances of the readers, their experience or financial situation. The past performance is not a guarantee or prediction of future results.
