Gold surged toward $2,800 per ounce on Friday, reaching its all-time high as investors flocked to the safe-haven asset after US President Donald Trump reiterated his threats of imposing additional tariffs.
Gold hits new all-time high amid trade war news
His statements reignited concerns over escalating trade tensions and the potential for an economic slowdown, which fueled demand for gold as a hedge against uncertainty. The precious metal's upward momentum was further strengthened by the actions of major central banks adopting looser monetary policies.
Central banks effects
The European Central Bank (ECB) followed expectations by cutting interest rates and signaled the possibility of more reductions in the future. Similarly, the Bank of Canada (BoC) concluded its quantitative tightening program, while the Swedish Riksbank also implemented rate cuts earlier in the week. Central banks in China (PBoC) and India (RBI) hinted at further easing measures and efforts to inject more liquidity into their respective economies, adding to the global trend of relaxed monetary policy.
Ounce up amid uncertainty
Meanwhile, the US Federal Reserve kept rates unchanged, offering no indication of any immediate moves, which further reinforced expectations that the Fed could implement two rate cuts later in the year. Against this backdrop of economic and policy uncertainty, gold has benefitted from both geopolitical and monetary factors, positioning it for its largest monthly gain since March 2024. With the market sentiment tilting toward caution, gold’s rally is expected to continue as investors look for safe investments in times of heightened global risks.
