Trade War Escalation Pushes Gold Higher as Markets Seek Safety

Gold prices have climbed above $2,915 per ounce as escalating trade tensions drive investors toward safe-haven assets.

President Trump’s recent tariffs against Canada and Mexico, along with doubled charges on China, triggered swift retaliation, including Beijing’s implementation of 15% duties on American farm goods.

This trade war escalation, combined with the U.S. pausing military aid to Ukraine, has created significant market uncertainty. After reaching a record high of nearly $2,955 in February followed by profit-taking, gold has recovered approximately 2% this week.

Goldman Sachs analysts project gold could reach $3,300 per ounce by year-end due to policy uncertainty. Meanwhile, disappointing U.S. economic data showing weaker housing, rising unemployment claims, and decreased personal spending have increased expectations for Federal Reserve interest rate cuts later this year, further enhancing gold’s appeal as a non-yielding asset in uncertain times.