Gold Prices Near Three-Month Highs Due to Dual Factors

双重因素下,黄金价格接近三个月高点
Published on: Jan 23, 2025
Author: Amy Liu

Investors are focusing on the potential impact of the Trump administration’s tariffs and tax cuts, which could weaken the nation’s fiscal situation and reignite inflation, potentially limiting the Federal Reserve’s ability to ease monetary policy further.

Earlier this week, Trump indicated that his administration might impose a 25% import tariff on Canada and Mexico before February 1. This tariff threat has since been extended to China and the European Union.

However, in his second term, Trump has yet to provide many details regarding his proposed tariffs, which has led investors to question the severity of the measures and their potential impact. This uncertainty has enhanced the appeal of safe-haven assets, causing gold prices to surge on Wednesday, January 22, reaching their highest levels in nearly three months.

As of 11:05 AM Eastern Time, spot gold was up 0.6% at $2,759.51 per ounce, just about $30 shy of last year’s record high. In New York, U.S. gold futures rose 0.4%, hitting $2,771.20 per ounce.

Earlier in the trading session, gold prices peaked at $2,762 per ounce. The previous trading day saw gold prices increase by 1.4%, spurred by Trump’s comments regarding possible tariffs on global trade partners.

Ryan McIntyre, a senior portfolio manager at Sprott Asset Management, noted, “The proposed tariffs and other issues are fraught with uncertainty, and gold typically performs well during periods of significant or even moderate market uncertainty, prompting investors to gravitate towards it.”

Independent metal trader Tai Wong remarked, “Trump may be somewhat more moderate on tariffs than people fear, which is a good thing. Lowering tariffs is seen as helpful for reducing inflation, potentially paving the way for more rate cuts.”

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