Gold Soars Over 1% as U.S.-China Tariff War Heats Up, Investors Rush to Safe Haven
Gold prices surged more than 1% on Thursday, buoyed by a flight to safety after U.S. President Donald Trump escalated tariffs on China, raising fresh concerns over inflation and global growth. Despite a temporary tariff pause for other countries, the move intensified the ongoing trade war between the world’s two largest economies. 🔥 Tariff Tensions Reignite Demand for Bullion Trump announced a tariff increase on Chinese imports to 125% from 104%, prompting investors to seek refuge in gold, a traditional hedge during economic and geopolitical uncertainty. The latest tariffs overshadowed the administration’s decision to temporarily ease duties for other nations. “If we enter a slow growth period, which is our base case, we think rates will eventually head lower and push gold higher,” said Edward Meir, analyst at Marex, adding that $3,200/oz could be reached “by month-end, if not earlier.” 📈 Factors Fueling the Gold Rally in 2025 Gold has already gained more than 18% this year, fueled by: 📊 Fed’s Balancing Act Minutes from the Fed’s latest meeting reveal that most policymakers are concerned about the economy facing “higher inflation alongside slower growth.” This puts pressure on the Fed’s future rate decisions, with possible trade-offs looming. Gold, which yields no interest, typically underperforms when rates are high. However, its role as an inflation hedge keeps it attractive amid uncertainties. 🔍 What’s Next? Investors are now eyeing key U.S. data: These indicators could provide further clues on inflation trends and Fed policy direction. 🪙 Other Precious Metals
