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Trump tariff worries keep gold near record high level

Published: 20 Feb. 2025, 11:14

Gold bars are displayed to be photographed at bullion house in Mumbai, India, Dec. 3, 2009. [REUTERS/YONHAP]

Gold prices edged higher on Thursday, hovering near their all-time highs as concerns persisted over U.S. President Donald Trump's tariff strategies, which could fuel inflation and escalate a global trade war.

* Spot gold rose 0.2% to $2,938.57 an ounce, as of 0027 GMT. Bullion scaled an all-time high of $2,946.85 on Wednesday.

* U.S. gold futures gained 0.7% to $2,955.20.

* Trump imposed a 10% tariff on Chinese imports and a 25% tariff on steel and aluminium earlier this month. Furthermore, he recently said he intends to impose auto tariffs "in the neighborhood of 25%", along with similar duties on semiconductor and pharmaceutical imports.

* Minutes of the latest Federal Reserve policy meeting on Wednesday showed that Trump's initial policy proposals raised concern about higher inflation and affirmed a continued pause on rate cuts.

* The Fed held its benchmark interest rate at 4.25%-4.50% range at its meeting last month, and officials have since said they are in no rush to cut rates again until they are more certain inflation will decline to the 2% target.

* Traders currently see the Fed delivering 38 basis points worth of rate cuts by December, according to LSEG data.

* Bullion is seen as a safeguard against geopolitical risks and inflation, but higher interest rates dampen the non-yielding asset's appeal.

* A slew of Fed officials are scheduled to speak later in the day, which could provide further insights on U.S. central bank's monetary policy.

* Spot silver was steady at $32.71 an ounce. Platinum fell 0.2% to $969.70, and palladium was steady at $968.38.

REUTERS