Gold prices rose by about 1% during trading on Wednesday, after investors moved strongly towards safe havens during Asian trading, amid escalating uncertainty related to US trade policy following the Supreme Court ruling that overturned a large part of the measures imposed by US President Donald Trump.
These moves reflect gold's return to the forefront of global markets, as investors once again view it as the safest tool in the face of increasing political and economic volatility.
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China's resurgence and US uncertainty support gold
Kyle Rodda, senior market analyst at Capital.com, explained that the return of Chinese trading to normal activity, coupled with rising political uncertainty in the United States, boosted the appeal of gold, and the positive effect extended to a lesser extent to silver.
This comes at a time when the United States has begun implementing a temporary global tariff of 10% on imports, while Washington is working to raise it to 15%, according to a White House official. This has created confusion in the markets regarding the actual direction of US trade policies after the US administration lost its legal battle before the Supreme Court.
These developments show that markets are not only dealing with economic decisions, but also with a volatile political environment whose course is difficult to predict, which is driving global capital to hedge against the effects of gold.
Monetary policy and future price expectations
At the same time, two US Federal Reserve officials indicated that there is no imminent move to adjust interest rate policy, which gives gold additional support, as stable interest rates reduce pressure on non-yielding assets such as the precious metal.
Markets currently expect three interest rate cuts of 25 basis points each this year, according to estimates from the CME Group's FedWatch tool, forecasts that reinforce the bet on the continuation of the upward trend for gold.
Roda believes that gold still has ample room to make further gains as long as the factors supporting it continue, most notably US fiscal policies, geopolitical tensions, and shifts in global foreign policy.
Geopolitical tensions reignite demand for safe havens
US President Donald Trump’s speech to Congress heightened geopolitical concerns after he hinted at the possibility of a military strike against Iran, stressing that he would not allow Tehran to possess a nuclear weapon.
These statements came at a time when reports indicate that Iran is close to finalizing an agreement with China to purchase anti-ship cruise missiles, according to Reuters sources, while the United States and Iran prepare to hold a third round of nuclear talks in Geneva on Thursday.
This scenario reflects the return of geopolitical risks as a key factor in gold pricing, as historically the price of the precious metal rises whenever the likelihood of military escalation or major international tensions increases.
A broader analytical reading of market trends
The current upward surge reflects the convergence of three key factors that rarely come together at the same time: US political uncertainty, geopolitical tensions, and expectations of interest rate cuts – a combination historically associated with the beginnings of long upward waves for gold.
The continued heavy buying of gold by global central banks, led by China, adds long-term structural support to prices, meaning that any potential downward correction could turn into a buying opportunity rather than the start of a new downward trend.
Given these circumstances, it appears that gold is no longer merely reacting to crises, but rather reflects a deeper shift in the global financial system, as markets gradually move towards real assets in the face of a world increasingly uncertain in economic and political terms.
Gold at settlement yesterday
Gold prices fell at the close of trading on Tuesday, affected by profit-taking and a stronger dollar, amid escalating trade and geopolitical uncertainty, but silver rose nonetheless.
Gold futures for April delivery fell 0.94%, or $49.30, to $5,176.30 an ounce, after rising nearly 3% to a three-week high at the close of the previous session.
Gold now
Spot gold rose 0.8% to $5,186.16 an ounce.
Meanwhile, U.S. gold futures for April delivery rose 0.6% to $5,205 an ounce, indicating continued strong investment demand for the precious metal.
A collective rise in precious metals
The rise was not limited to gold alone, as silver prices jumped 3.4% to reach $90.32 an ounce, recording their highest level in 3 weeks, which reflects the transfer of investment momentum to the rest of the precious metals.
Platinum also rose 4.7% to $2,269.82 an ounce, its highest level since February 4, while palladium climbed 1.9% to $1,801.47 an ounce, also a three-week high.
This collective movement indicates that investors are not only looking for short-term hedging, but are also rebuilding strategic positions in precious metals in anticipation of a more volatile global economic cycle.
