Gold prices stabilize after Trump's announcement on tariffs

SadaNews - Gold prices stabilized after recovering from previous session losses, as President Donald Trump began informing a group of countries about the new tariff rates, which boosted demand for safe havens amid growing fears of a trade war led by the United States.

The precious metal ended Monday's trading virtually unchanged after earlier declining by as much as 1.2%, remaining steady on Tuesday at around $3,335 per ounce.

The U.S. president stated that Japan and South Korea would face a 25% tariff on goods, with other rates imposed on different trading partners, leading to sell-offs in the currencies of the targeted countries and bolstering the dollar's strength. A stronger dollar often makes gold more expensive for most buyers.

Starting with Asian countries

Asian countries were the first to receive these messages as part of what the president promised would be a flood of unilateral warnings and trade deals announced on Monday.

At the same time, investors are looking for more potential ramifications as the White House prepares to impose higher tariffs on countries that do not reach an agreement with the United States.

However, Trump's decision to delay the implementation of the new rates until August 1 effectively gives each affected country an additional three-week grace period to strike a deal.

Trump's policies support gold

Trump's efforts to reshape trade policies are a constant concern for markets, amid fears of the impact of extensive U.S. tariffs on the global economy.

This has driven investors to seek safe-haven assets like gold, which has risen more than a quarter of its value this year and is currently about $160 away from the all-time high it reached in April. The escalating geopolitical tensions have also contributed to the metal's appeal as a safe haven.

The spot gold price stabilized at $3,337.30 per ounce by 7:15 AM in Singapore. The Bloomberg dollar index fell by 0.1% after rising by 0.5% on Monday. There was little change in silver and palladium prices, while platinum declined.

Source: Bloomberg