Gold prices climb amid trade war tensions, rising to their highest level in three weeks. On Monday, spot gold hit $3,359.69 per ounce. This increase followed warnings from the U.S. government about new tariffs on imports from the European Union and Mexico.
The U.S. President announced a 30% tariff that may begin on August 1. These trade threats caused investors to seek safer assets, leading to higher gold prices. U.S. gold futures also gained, reaching $3,373.30 per ounce. The metal’s value is benefiting from growing global uncertainty.
Analyst Kelvin Wong from OANDA said safe-haven demand is increasing. He also noted that gold may continue rising if it closes above $3,360. According to Wong, the next target could be around $3,435 if momentum stays strong.
While gold prices climb amid trade war tensions, both the EU and Mexico called the proposed tariffs unfair. The EU decided to delay its countermeasures until early August. In the meantime, officials will continue negotiating with the U.S. to find common ground.
The Federal Reserve’s upcoming interest rate decisions may further affect gold. Investors are watching the June inflation report, which will be released Tuesday. If inflation slows, the Fed may lower rates later this year. Markets currently expect over 50 basis points in rate cuts by December.
Since gold often thrives during low-rate periods, further easing would likely support its growth. However, the rising dollar may limit gains. On Monday, the dollar index increased by 0.2%. This rise made gold more expensive for buyers using other currencies.
Speculators reduced their net long gold positions by 1,855 contracts last week. Yet, strong investor interest continues to support the upward trend. Gold prices climb amid trade war tensions, reflecting the market’s anxiety and shifting strategies.
Meanwhile, silver rose 1.5% to $38.93 per ounce. In contrast, platinum dropped 1% to $1,384.81, and palladium declined 0.7% to $1,208.15. These fluctuations show how sensitive metals are to trade news and dollar strength.
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