Gold Nears $3,000 as Geopolitical Risks and Trump's Comments Buoy Prices
Gold futures surged to a record high Thursday, approaching the $3,000 mark amidst geopolitical tensions, tariff risks, and President Trump's statements regarding US gold reserves.
Escalating Trade Tensions
Trump's announcement of tariffs on autos, semiconductors, and pharmaceuticals exacerbated concerns over a trade war. Wall Street anticipates retaliatory measures from other countries, potentially driving inflation and prompting investors to seek safe-haven assets like gold.
Ukraine-Russia Conflict Uncertainty
Trump's comments on potentially withdrawing support for Ukraine and the ongoing conflict further fueled gold buying. Uncertainty surrounding a peace deal has contributed to market volatility.
Trump's Fort Knox Announcement
Trump's intention to verify US gold reserves at Fort Knox sparked speculation of higher gold prices. Market participants ponder a potential revaluation from $42 per ounce to current market prices, increasing transparency and potentially pushing prices further up.
Central Bank Demand
Goldman Sachs raised its 2025 gold price forecast to $3,100 per ounce, citing structurally higher central bank demand, particularly from China. Uncertainty surrounding tariffs and policy could maintain high speculative positioning and push prices as high as $3,300 by year-end.
Gold as a Hedge
JPMorgan analysts emphasize the disruptive effects of tariffs on economic growth and inflation, making gold an attractive hedge for investors.
Market Performance
Gold futures (GC=F) reached an intraday high of $2,973 per ounce before settling at $2,953.90, up 0.61%. Cash market gold surpassed $2,954 an ounce.