Gold price hits record high as tariff concerns push investors to safe haven

Gold prices have climbed to a new pinnacle, surpassing $3,200 an ounce, driven by investor anxiety regarding the potential economic impact of tariffs on global trade. In early Asian trading on Friday, bullion rose by as much as 1.3%, setting a fresh record after consecutive days of gains exceeding 3%. Recent fluctuations in President Donald Trump's stance on tariffs have intensified selloffs in US stocks, bonds, and the dollar, underscoring the appeal of gold as a safe haven. The ongoing uncertainty is exacerbated by scepticism over the timely resolution of trade negotiations, despite reassurances from Kevin Hassett, the White House Economic Council Director, who stated that the United States is "well advanced" in its discussions with economic partners.

Gold's rally, which has seen a more than 20% increase this year, is further supported by expectations of additional monetary easing by the Federal Reserve and persistent purchases by central banks. Recent US inflation data revealed a broad cooling in March, leading traders to anticipate multiple interest-rate cuts by year's end. Lower interest rates typically advantage gold, as it does not pay interest. Dominic Schnider of UBS Global Wealth Management expressed optimism about gold's trajectory, noting on Bloomberg Television that "the next step is going to be, at some point, the Fed coming in — and that gives the next leg up for gold." Spot gold in Singapore increased by 1.2% to $3,215.73 an ounce, targeting a weekly gain of nearly 6%.

The Bloomberg Dollar Spot Index declined for the fourth consecutive day, while silver and platinum prices rose, and palladium remained relatively unchanged. The current market dynamics highlight the reinforced status of gold as a protective asset amidst ongoing economic uncertainties. As global markets remain volatile due to tariff-related concerns, the outlook for gold remains positive, driven by expectations of further fiscal interventions and easing measures.