Gold Gains After Pullback as Trump Tariffs Stoke Economic Fears
Gold rose after last week’s sharp correction, with investors weighing the economic outlook as US President Donald Trump prepares to implement import levies against key trade partners.
Worries over the economy have boosted market expectations for Federal Reserve interest-rate cuts, which would also add to bullion’s appeal as a non-yielding asset.
“The upcoming US payrolls report is poised to shed light on the health of the employment market,” said Priyanka Sachdeva, analyst at Phillip Nova Pte Ltd. “Weak figures could prompt the Federal Reserve to consider rate cuts, further supporting gold prices.”
At the same time, investors remain concerned about inflation, as Trump’s proposed tariffs threaten to keep price pressures elevated — a view that saw the dollar surge last week. A stronger greenback makes dollar-denominated gold more expensive for foreign investors.
Recent US data has stoked fears the US may be entering a period of stagflation, when an economy faces both tepid growth and elevated prices. That could support gold, an asset regarded as a store of value in uncertain times.
Spot gold rose 0.2% to $2,862.61 an ounce at 7:16 a.m. in London, after ending last week 2.7% lower. The Bloomberg Dollar Spot Index eased 0.2%. Silver and Palladium gained, while platinum was flat.
