Gold surged to a record high, surpassing the key $3,000 mark, driven by trade war concerns and expectations of the U.S. Federal Reserve rate cut.
U.S. gold futures rose 0.73% to $3,013.10, marking the 13th all-time high this year and securing a second consecutive week of gains.
Investor sentiment remains bullish as geopolitical uncertainty fuels demand for safe-haven assets. "Risk is tilted to the upside as long as chaotic policymaking persists," said Nitesh Shah, commodities strategist at WisdomTree. The global trade war, exacerbated by President Donald Trump’s aggressive tariffs—including a proposed 200% levy on European alcohol imports—has bolstered gold’s appeal.
Momentum in gold-backed ETFs also contributed to the rally. SPDR Gold Trust holdings reached 905.81 metric tons, their highest level since August 2023. Global bullion-backed ETF holdings climbed to 2,687 tons, reflecting increasing investor confidence.
Meanwhile, inflation data released Wednesday showed consumer prices cooling more than expected, raising prospects for a Fed rate cut. While policymakers are expected to keep rates steady at their upcoming meeting, traders anticipate cuts beginning in June.
Market strategists see further gains ahead. Yeap Jun Rong of IG Asia noted that reciprocal tariffs set for April could heighten market turbulence, reinforcing gold’s role as a premier safe-haven asset. Banks have adjusted their forecasts accordingly: Macquarie Group now predicts gold could reach $3,500 per ounce in Q2, while BNP Paribas projects sustained levels above $3,000. Analysts at ANZ also maintain a bullish outlook, forecasting prices to hit $3,050 per ounce in 2025.