On Friday, gold prices soared to unprecedented levels, driven by a surge in safe-haven demand amid ongoing uncertainties surrounding U.S. tariffs and trade conflicts. The prospect of a potential easing of monetary policies by the U.S. Federal Reserve further enhanced the allure of this precious metal. Spot gold slightly dipped by 0.1%, settling at $2,983.78 per ounce after reaching a staggering $2,990.09 earlier in the day, tantalizingly close to the $3,000 benchmark.
Record Gold Prices Amid Economic Uncertainty
Gold’s impressive performance marks its second consecutive week of gains, showcasing a 2.5% increase thus far. Meanwhile, U.S. gold futures experienced a modest rise of 0.2%, reaching $2,996.70. Other precious metals also displayed varied trends:
- Spot silver: Decreased by 0.2%, priced at $33.72 per ounce
- Platinum: Gained 0.1%, valued at $995.30
- Palladium: Increased by 0.7%, trading at $964.32
Impact of Trade Wars on Inflation
The ongoing trade war initiated by U.S. President Donald Trump has ignited fears of inflation and recession within the world’s largest economy. This climate has pushed gold prices to new heights in 2025, as investors view the metal as a protective asset against political instability and inflationary pressures. In retaliation to U.S. tariffs on steel and aluminum, the European Union has imposed a 50% tariff on American whiskey exports, prompting Trump to threaten a 200% tariff on imports of European wines and spirits.
Anticipation of Federal Reserve’s Next Move
As market participants look forward to the upcoming U.S. Federal Reserve’s monetary policy meeting scheduled for next Wednesday, expectations are that the central bank will maintain its benchmark overnight interest rate within the 4.25% – 4.50% range. Lower interest rates typically favor non-yielding assets like gold, making it an attractive investment during such times.
Market Overview in India
On the domestic front, the Indian stock and commodity markets remained closed on March 14, 2025, in observance of Holi. However, they are set to resume trading for the evening session at 5 PM. In the previous session, MCX gold prices remained stable at ₹87,775 per 10 grams, while MCX silver saw a slight decline of ₹95, or 0.09%, ending at ₹1,00,450 per kg.
With the current economic landscape and trade tensions, gold continues to shine as a reliable asset amidst uncertainty. For more insights into market trends, stay tuned to our updates.
