Gold prices surged to an all-time high on Wednesday as safe-haven demand spiked amid escalating trade tensions between the U.S. and China. Spot gold climbed 0.6% to $2,858.27 an ounce, while gold futures for April rose 0.4% to $2,885.39 an ounce.
Trade war fears fuel gold’s rally
The U.S.-China trade war intensified after President Trump’s 10% tariffs on Chinese imports took effect, prompting retaliation from Beijing. China responded with its own tariffs, export restrictions, and actions against select U.S. firms like Google. Trump’s refusal to engage in negotiations with Chinese President Xi Jinping further rattled investors, driving money into safe-haven assets like gold.
Geopolitical uncertainty adds to market jitters
Gold’s rally was also fueled by Trump’s controversial comments about the Gaza Strip, where he suggested a U.S. takeover and the relocation of Palestinians. The remarks sparked strong backlash from Middle Eastern nations, raising fears of heightened geopolitical risks and further supporting demand for gold.
What’s next for gold?
While gold is benefiting from market uncertainty, some analysts warn that prolonged tariffs could push inflation higher, which might eventually impact gold’s long-term outlook. For now, traders are watching the next moves in the trade war and global politics to see if gold’s record-breaking rally continues.
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