Gold rebounds as India-US tariff tensions rise, investors rush to safe-haven assets
Gold prices surged after new US tariffs on India reignited global trade tensions. Weak rupee and safe-haven demand further pushed domestic gold rates toward Rs 1 lakh per 10 grams.
- Jul 31, 2025,
- Updated Jul 31, 2025 2:17 PM IST
Gold prices staged a strong recovery on Thursday, July 31, bouncing back from a one-month low as fresh tariffs announced by U.S. President Donald Trump reignited concerns over global trade. The surprise move, which included new levies on imports from India and South Korea, sent shockwaves through markets and prompted investors to flock back to gold, a traditional safe-haven asset during times of geopolitical and economic uncertainty.
In India, the ripple effect was immediate. Domestic gold prices surged in response to both the global uptick and a weakening rupee. According to Goodreturns, the price of 24-karat gold stood at Rs 10,049 per gram, while 22-karat and 18-karat gold were priced at Rs 9,211 and Rs 7,537 per gram, respectively.
Jateen Trivedi, VP Research Analyst at LKP Securities, remarked, “The trading range has now shifted higher to Rs 98,500–Rs 1.01 lakh per 10 grams,” suggesting that gold may be gearing up for a stronger rally if trade tensions persist or escalate.
On the international front, gold was trading near $3,300 an ounce on the COMEX, with analysts identifying a critical resistance level at $3,355. A breakout above this level could mark the continuation of a bullish trend, especially as global central banks weigh monetary easing and inflation remains sticky. Central bank buying and potential interest rate cuts by the U.S. Federal Reserve are seen as potential tailwinds.
The market remains in a state of cautious consolidation. Investors are wary, assessing how various geopolitical developments — including ongoing U.S.-China negotiations and a broader slowdown in global trade — will affect the trajectory of precious metals.
What triggered the surge?
The rebound in gold prices followed President Trump’s announcement of new tariffs: a 25% levy on Indian goods starting August 1, a 15% tariff on South Korean imports, and the removal of exemptions for low-value shipments. These unexpected moves stoked fears of a return to protectionist policies, weakening investor confidence in traditional markets and lifting demand for gold.
Historically, gold performs well during periods of uncertainty, as it offers a hedge against market volatility and currency depreciation. As trade relationships grow more unpredictable, more investors are pivoting to gold to shield themselves from shocks.
However, the outlook is not entirely straightforward. While the Federal Reserve kept interest rates unchanged in its latest meeting — a decision typically bearish for gold — the internal dissent within the Fed’s board hinted at uncertainty in future rate decisions. Ross Maxwell, Global Strategy Lead at VT Markets, explained, “Chair Powell emphasized inflation remains above target, and no decision has been made for September. That uncertainty is supporting the dollar in the short term, which usually pressures gold lower.”
Gold’s future
On the Multi Commodity Exchange (MCX), gold has entered a consolidation phase, currently hovering around Rs 99,700 per 10 grams. Experts forecast a trading band between Rs 98,000 and Rs 1 lakh, with a potential breakout above Rs 1.01 lakh opening the path to Rs 1.03 lakh.
In the short term, market participants are adopting a cautious stance, with strategies based on technical levels: downside targets at Rs 98,000 and stop losses at Rs 1.01 lakh.
Analysts suggest that this is a good time for long-term investors to accumulate gold on dips. With inflation concerns and currency volatility still looming large, gold remains a strategic hedge in a well-balanced portfolio. Even modest exposure to the yellow metal can act as a financial cushion during downturns.
Silver price
In contrast, silver is showing a bearish pattern on the MCX, characterized by a trend of lower highs and lower lows. The current support level lies at Rs 1,09,000, and a breakdown below this could lead to further declines. Conversely, any potential upside faces resistance near Rs 1,14,000 — a zone where sellers have consistently emerged.
Currently priced at Rs 1,11,500, silver is being traded cautiously, with many traders targeting Rs 1,09,000 and maintaining a stop loss at Rs 1,16,000. Global cues such as U.S. economic data and dollar strength are expected to continue influencing silver’s trajectory.
Both gold and silver remain central to investor strategies amid market volatility. With geopolitical tensions on the rise, precious metals are once again proving their value as both defensive assets and strategic investments.
Gold prices staged a strong recovery on Thursday, July 31, bouncing back from a one-month low as fresh tariffs announced by U.S. President Donald Trump reignited concerns over global trade. The surprise move, which included new levies on imports from India and South Korea, sent shockwaves through markets and prompted investors to flock back to gold, a traditional safe-haven asset during times of geopolitical and economic uncertainty.
In India, the ripple effect was immediate. Domestic gold prices surged in response to both the global uptick and a weakening rupee. According to Goodreturns, the price of 24-karat gold stood at Rs 10,049 per gram, while 22-karat and 18-karat gold were priced at Rs 9,211 and Rs 7,537 per gram, respectively.
Jateen Trivedi, VP Research Analyst at LKP Securities, remarked, “The trading range has now shifted higher to Rs 98,500–Rs 1.01 lakh per 10 grams,” suggesting that gold may be gearing up for a stronger rally if trade tensions persist or escalate.
On the international front, gold was trading near $3,300 an ounce on the COMEX, with analysts identifying a critical resistance level at $3,355. A breakout above this level could mark the continuation of a bullish trend, especially as global central banks weigh monetary easing and inflation remains sticky. Central bank buying and potential interest rate cuts by the U.S. Federal Reserve are seen as potential tailwinds.
The market remains in a state of cautious consolidation. Investors are wary, assessing how various geopolitical developments — including ongoing U.S.-China negotiations and a broader slowdown in global trade — will affect the trajectory of precious metals.
What triggered the surge?
The rebound in gold prices followed President Trump’s announcement of new tariffs: a 25% levy on Indian goods starting August 1, a 15% tariff on South Korean imports, and the removal of exemptions for low-value shipments. These unexpected moves stoked fears of a return to protectionist policies, weakening investor confidence in traditional markets and lifting demand for gold.
Historically, gold performs well during periods of uncertainty, as it offers a hedge against market volatility and currency depreciation. As trade relationships grow more unpredictable, more investors are pivoting to gold to shield themselves from shocks.
However, the outlook is not entirely straightforward. While the Federal Reserve kept interest rates unchanged in its latest meeting — a decision typically bearish for gold — the internal dissent within the Fed’s board hinted at uncertainty in future rate decisions. Ross Maxwell, Global Strategy Lead at VT Markets, explained, “Chair Powell emphasized inflation remains above target, and no decision has been made for September. That uncertainty is supporting the dollar in the short term, which usually pressures gold lower.”
Gold’s future
On the Multi Commodity Exchange (MCX), gold has entered a consolidation phase, currently hovering around Rs 99,700 per 10 grams. Experts forecast a trading band between Rs 98,000 and Rs 1 lakh, with a potential breakout above Rs 1.01 lakh opening the path to Rs 1.03 lakh.
In the short term, market participants are adopting a cautious stance, with strategies based on technical levels: downside targets at Rs 98,000 and stop losses at Rs 1.01 lakh.
Analysts suggest that this is a good time for long-term investors to accumulate gold on dips. With inflation concerns and currency volatility still looming large, gold remains a strategic hedge in a well-balanced portfolio. Even modest exposure to the yellow metal can act as a financial cushion during downturns.
Silver price
In contrast, silver is showing a bearish pattern on the MCX, characterized by a trend of lower highs and lower lows. The current support level lies at Rs 1,09,000, and a breakdown below this could lead to further declines. Conversely, any potential upside faces resistance near Rs 1,14,000 — a zone where sellers have consistently emerged.
Currently priced at Rs 1,11,500, silver is being traded cautiously, with many traders targeting Rs 1,09,000 and maintaining a stop loss at Rs 1,16,000. Global cues such as U.S. economic data and dollar strength are expected to continue influencing silver’s trajectory.
Both gold and silver remain central to investor strategies amid market volatility. With geopolitical tensions on the rise, precious metals are once again proving their value as both defensive assets and strategic investments.