Gold prices have surged to unprecedented levels, crossing the $3,000 mark per ounce. This spike is largely attributed to the heightened trade tensions instigated by U.S. President Donald Trump. His aggressive tariff policies, aimed at coercing trade concessions, have incited significant market volatility. Trump recently threatened the European Union with 200% tariffs on wine and other alcoholic beverages, demanding a rollback of the EU's 50% tariff on American whiskey. This demand is part of a broader conflict, stemming from EU responses to U.S. tariffs on steel and aluminum.
Investors are turning to gold as a safe haven amidst fears of escalating trade barriers and their potential economic repercussions, particularly on the U.S. economy. The ongoing trade war has led to sustained declines in stock markets globally, further driving investors towards gold. Geopolitical risks and rising inflation concerns also contribute to this trend.
Physical gold is being moved from London to New York to circumvent potential tariffs, creating price disparities that traders are exploiting through arbitrage. The Swiss gold refinery, Argor-Heraeus, has seen a surge in demand for its gold bars, particularly from the U.S. market.
With analysts predicting that gold prices could reach $3,050 per ounce by 2025, the current upward trend is expected to continue. The combination of market turbulence and economic uncertainty is likely to keep gold attractive to investors seeking stability.
