Gold rose on Thursday, supported by a weaker U.S. dollar and growing worries over U.S. President Donald Trump’s tariff plans, which could heighten global trade tensions, while investors eyed another set of inflation data.
- Copper caught in tariff war, expected to move above 900 on MCX
- Silver softens ahead of US CPI report
- Gold takes a breather after record run on trade war fears
- Volatility in gold and silver prices will continue this week
- Protected: Weekly Commodity Technical Analysis and Forecast 10 To 14 January 2025
On Wednesday, gold prices fell more than 1% after stronger-than-expected U.S. consumer price index for January, but rebounded later as ongoing trade war uncertainties kept the safe-haven metal’s demand intact.
Trump announced plans to impose reciprocal tariffs on countries that levy duties on U.S. imports, expected Wednesday or Thursday.
“Trump is unpredictable and, as long as uncertainty remains in the market, gold will continue to receive support,”.
“Overall, the dollar index is currently under pressure, which has been supportive for gold.”
The dollar index DXY fell 0.2%, making greenback-priced gold less expensive for foreign buyers.
Investors are now focussed on the U.S. Producer Price Index (PPI) data due at 1330 GMT, followed by Friday’s retail sales report, for further economic clues.
Meanwhile, Federal Reserve Chair Jerome Powell, at his second congressional hearing this week, reiterated that the central bank was in no rush to cut interest rates.
“Market is convinced that there is very limited room for the Fed to ease; Fed funds futures trimmed rate cut expectation to 29bps for this year, with the chance of a 25bp cut priced at 78% by September and at 94% by October,”.
Bullion is seen as a hedge against inflation and economic uncertainties, but higher interest rates tarnish the non-yielding asset’s allure.
We expects gold to touch a record high of $3,032 per ounce in March 2025.
