Gold prices near $5187 per ounce as tensions escalate

SadaNews - Gold prices rose as traders assessed geopolitical tensions in the Middle East and the impact of U.S. tariffs on global trade.

The price of the precious metal climbed toward the $5200 per ounce mark, having gained nearly 6% over the past six sessions, amidst a buildup of U.S. forces in the Middle East that kept global markets on edge.

Washington imposed sanctions on more than 30 entities supporting Iranian oil and arms sales, adding pressure on Tehran ahead of the latest round of nuclear talks on Thursday in Geneva.

At the same time, President Donald Trump’s administration moved forward with steps to maintain its tariff agenda, which added tension to already strained relations with trade partners.

U.S. Trade Representative Jameson Greer stated that Trump would sign a directive increasing global tariffs to 15% "when appropriate." A broad 10% tariff went into effect on Tuesday after the Supreme Court overturned what is known as Trump's "reciprocal" tariffs.

Repricing geopolitical and trade risks

Christopher Wong, a strategist at Oversea Chinese Banking Corp, indicated that recent movements in gold reflect a "repricing of the new uncertainty regarding tariffs and geopolitical concerns."

He added that a bidirectional move is likely as the market absorbs the latest news, along with Federal Reserve policy and dollar fluctuations. The U.S. dollar index fell by 0.1% on Thursday after finishing the previous session down by 0.2%

Gold has risen by about 20% this year, finding renewed support above the $5000 per ounce level after a steep two-day decline from a record high of $5595 in late January.

Ongoing geopolitical and trade tensions have added momentum to a multi-year uptrend, bolstering bets against the value of the dollar, as investors shift away from the U.S. currency and treasury bonds.

Concerns over Federal Reserve independence

In a further indicator of tensions, Cuban forces killed four individuals who had opened fire from a speedboat bearing Florida registration plates, in an incident with the potential to escalate a tense standoff with the U.S.

Concerns about government interference in U.S. Federal Reserve policies also supported the precious metal. In a farewell article before his retirement, the President of the Federal Reserve Bank of Atlanta, Raphael Bostic, expressed concern that Americans have begun to question the independence of the central bank.

Spot gold prices rose by 0.5% to $5188.76 per ounce by 9:19 AM in Singapore. Silver climbed by 0.9% to $89.99, while both platinum and palladium also increased.