Gold prices continued their upward trend on Wednesday, extending gains after reaching a record high the previous day. Investors turned to gold as a safe-haven asset ahead of the anticipated U.S. reciprocal tariffs set to be announced by President Donald Trump.
Spot gold rose 0.2%, while U.S. gold futures remained steady at the same level. Analysts attribute this rally to geopolitical uncertainty and investor concerns over inflation and economic growth.
Philip Newman, managing director of Metals Focus, noted that continued safe-haven demand could push gold prices to $3,300 in the coming months. Similarly, Aakash Doshi of State Street Global Advisors suggested that gold might test $3,400 per ounce within nine months under bullish conditions.
The upcoming tariffs, which follow previous U.S. trade measures against China, Canada, Mexico, and various metal imports, have heightened market volatility. Investors are closely monitoring their impact on inflation, trade relations, and global economic stability.
Gold has emerged as one of the best-performing commodities of the year, surging 19% in the first quarter—its strongest quarterly performance since 1986. This rise has been driven by consistent central bank purchases, expectations of Federal Reserve interest rate cuts, and geopolitical tensions in the Middle East and Europe. Additionally, global holdings in gold-backed exchange-traded funds have reached their highest levels since September 2023.
As markets await key economic indicators, including the ADP employment report and non-farm payroll data, the trajectory of gold prices will largely depend on inflation trends and Federal Reserve policy decisions.