Gold prices rose on Tuesday, with spot gold at $3,021.88 per ounce, marking a 0.3% increase. U.S. gold futures also climbed 0.3%, settling at $3,025.90. The rise in gold was driven by demand for safe havens amid market uncertainty over the tariff plan to be announced by U.S. President Trump next week, which is believed might spur inflation.
Jeffrey Christian, managing partner at CPM Group, noted that concerns about global conditions, especially U.S. policy, have intensified, leading investors to view gold as an alternative asset due to fears the U.S. government might trigger a global recession. Gold prices have risen over 15% since the start of the year, reaching a record high of $3,057.21 on March 20. Trump stated that not all the threatened tariff measures would be implemented on April 2, with some countries potentially receiving exemptions. The Financial Times reported that Trump plans to execute tariffs in two phases.
It is widely believed that Trump's tariff policy could slow economic growth, escalate trade tensions, and increase inflationary pressure. Meanwhile, Atlanta Federal Reserve President Bostic anticipates that the Fed's benchmark interest rate will decrease by only 25 basis points by the end of the year. The Fed decided to maintain rates unchanged last week and hinted at a possible 50 basis points rate cut by the end of the year.
The market is currently awaiting the release of the U.S. Personal Consumption Expenditures (PCE) Price Index on Friday for signals on possible further Fed action. Additionally, silver, platinum, and palladium prices also rose, with spot silver up 1.9% to $33.61 per ounce; platinum increased by 0.5% to $978.15; and palladium up 0.4% to $955.00.
