Prime Highlights
- Gold prices rose more than $3,200 an ounce following investors rushing to safe-haven assets amidst tariff tensions between U.S. and China.
- President Trump’s tariff hike decision triggered market fear and increased demand for gold.
Key Facts
- Spot gold rose 0.6% to $3,192.79 and U.S. gold futures were at $3,237.50, some 2% higher.
- The dollar index in the U.S. fell below 100 and therefore made gold less expensive to investors across the world.
Key Background
The recent resurgence of tensions in the U.S.-China trade war has been a leading factor to restructure the world markets throughout 2025. Donald Trump’s last-minute action of placing strict tariffs on large shipments of Chinese products was an echo of his last administration’s hardball trade policy. The policy change agitated global supply chains and raised fresh specters of inflation and economic deceleration once more.
Gold did not shed its hedge tag in times of doubt and finds itself in tandem with past history when market unpredictability saw investors seek refuge in physical commodities in its recent upward run. During 2025, the trend was also motivated by further US dollar depreciation alongside skepticism regarding future monetary policy directions by the Federal Reserve. As inflation rates remain unknown, interest rate cut expectations have picked up momentum, lending further strength to gold’s upmove.
In addition, emerging market central banks also continued to add gold reserves as part of their overall strategy to reduce dollar exposure and hedge against geopolitical risk. This is the recurring theme that is lending structural support to gold prices above short-term speculation.
In the coming weeks, market strategists anticipate gold to keep testing the $3,500 level as long as there is monetary and trade uncertainty. With shifts in trade policy bolstering inflation concerns in addition to central bank policy, there is a backdrop that favors gold as an asset class of choice in portfolios worldwide.
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