Gold Breaks the $3,000 Mark for the First Time Amid Trade Tensions

Gold Breaks the $3000 Benchmark

On Friday, gold price per ounce exceeded $3,000 for the first time ever. This historic rally, driven by trade tensions and expectations of a U.S. rate cut, bolsters gold’s status as a safe haven asset.

Current Gold Market Status

As of Friday morning, spot gold saw an increment of 0.4% to reach $3,000.87 an ounce. U.S. gold futures also rose by 0.7%, reaching $3,013.60.

The precious metal has achieved 13 record highs so far this year and appears set for a second consecutive week of gains. Factors contributing to this surge include geopolitical and economic uncertainties and anticipated Federal Reserve rate cuts, according to Han Tan, Chief Market Analyst at Exinity Group.

Impact of Trade Tensions on Gold Prices

President Donald Trump’s tariffs have significantly influenced the demand for gold. The ongoing global trade war has unsettled financial markets and heightened fears of a recession. This was exacerbated by Trump’s recent threat to impose a 200% tariff on European alcohol imports. Learn more about how tariffs influence the market.

Gold-Backed ETFs and Interest Rates

Data shows that SPDR Gold Trust, the world’s largest gold-backed ETF, had its holdings at 905.81 metric tons; this is the highest since August 2023. The trend suggests that investors are opting for gold as a safer bet amidst unstable market conditions.

Additionally, Wednesday’s data showed U.S. consumer prices cooling, opening the possibility for further Federal Reserve rate cuts. Policymakers are expected to consider reducing borrowing costs at their next meeting in June.

Gold Price Forecast

Analysts at ANZ expect gold prices to reach a record high of $3,050 per ounce in 2025. Other precious metals market activity saw silver adding 0.4% to $33.94 an ounce, platinum dropping 0.5% to $989.04, and palladium gaining 0.3% to $960.71.

– Rahul Paswan, Sarah Qureshi and Ashitha Shivaprasad for Reuters.