Fresh Trump Tariffs Catapult Gold to Record High
Tue Feb 11 2025
Gold prices soared to a record high on Tuesday, as investors flocked to the safe-haven asset after US President Donald Trump imposed fresh 25% tariffs on steel and aluminium imports, fueling concerns of inflation and escalating trade war. Spot gold rose 0.4% to $2,917.80 per ounce as of 0510 GMT after hitting a record high of $2,942.70 earlier in the session, Reuters reported.
US gold futures firmed 0.3% to $2,944.10. Trump substantially raised tariffs on
steel and aluminium imports on Monday to 25% "without exceptions or
exemptions" in a move to aid the struggling industries. However, the
tariff raise increased the risk of a multi-front trade war.
The safe-haven metal hit its eighth record high so far in 2025 on Trump's
tariffs, which have fueled global growth uncertainties, trade war concerns and
inflationary pressure. "The risk of a global trade war is putting pressure
on trading in physical bullion and driving financial markets to get exposure to
gold as a part of what can be loosely described as a de-dollarization
theme," said Kyle Rodda, financial market analyst, Capital.com.
"Buyers seem to be somewhat price insensitive because dealers are doing what they can to ship gold into the US to avoid any potential tariffs slapped on the metal."
Concerns over import tariff plans materialized in US gold futures, with key
contracts trading at a premium to the spot price, currently at about $26.
The threats have ignited another gold rush, bringing the glittering $3,000 milestone into view.
Tariffs may exacerbate US inflation, with investors awaiting US Consumer Price
Index (CPI) and Producer Price Index (PPI) data this week.
Federal Reserve Chair Jerome Powell is due to testify before Congress on
Tuesday and Wednesday.
Spot silver fell 0.5% to $31.87 per ounce.
"While tariff fears may support silver, gains could be capped by falling
industrial demand in the face of Trump's tariffs," said FXTM senior
research analyst Lukman Otunuga.
Platinum eased 0.7% to $986.46, while palladium gained 0.4% to $987.25.