Gold Prices Rise as Trump’s Tariffs Push Investors to Safe Assets
The ongoing trade tensions and tariff uncertainty sparked by US President Donald Trump’s policies have sent gold prices soaring, enticing investors to seek refuge in safe-haven assets. As the global economy continues to navigate the choppy waters of protectionism, the allure of gold as a hedge against inflation and market volatility has grown stronger.
In India, the MCX gold opened on Tuesday at ₹85,399 per 10 grams, reaching an intraday high of ₹85,518. The global spot gold price remained resilient, surging by 1.2% on Monday to reach $2,891 per ounce. This upward trend is expected to continue as investors seek to diversify their portfolios and protect their wealth against the uncertain economic environment.
The Trump administration’s decision to impose tariffs on various imported goods has created a sense of unease among investors, who are increasingly turning to gold as a safe-haven asset. The yellow metal’s value tends to appreciate during times of economic uncertainty, making it an attractive option for those seeking to hedge against market volatility.
The impact of Trump’s tariffs is being felt globally, with many countries retaliating with their own tariffs on US goods. This tit-for-tat approach has led to a significant increase in trade tensions, causing investors to become increasingly risk-averse. In this environment, gold’s reputation as a reliable store of value has seen a resurgence, with many investors opting to allocate a portion of their portfolios to the precious metal.
The recent surge in gold prices is also being driven by geopolitical tensions. The ongoing conflict between the US and Iran, as well as the escalating trade tensions between the US and China, have created a sense of uncertainty among investors. In times of geopolitical turmoil, gold’s appeal as a safe-haven asset tends to increase, as investors seek to protect their wealth against the potential risks.
In addition to its reputation as a safe-haven asset, gold is also experiencing a resurgence in popularity due to its limited supply. The World Gold Council estimates that the global gold supply is insufficient to meet the growing demand, leading to a tightening of the market. This supply-and-demand imbalance has driven up the price of gold, making it an attractive option for investors seeking to diversify their portfolios.
The Indian gold market is also experiencing a surge in demand, driven by the ongoing wedding season and the festival of Akshaya Tritiya. The demand for gold in India is traditionally high during this period, with many investors seeking to purchase the metal as a symbol of good luck and prosperity. The recent surge in gold prices has also prompted many investors to buy gold as a long-term investment, rather than simply purchasing it for immediate consumption.
In conclusion, the rise in gold prices is a direct result of the uncertainty created by Trump’s tariffs and geopolitical tensions. As investors seek to protect their wealth against the potential risks, the value of gold is likely to continue its upward trend. The limited supply of gold and the growing demand for the metal are also factors that are driving up its price.
For investors seeking to diversify their portfolios and protect their wealth against market volatility, gold is an attractive option. Whether purchased as a long-term investment or as a safe-haven asset, gold is likely to remain a key player in the global financial markets for the foreseeable future.
Source:
https://www.siasat.com/gold-prices-surge-amid-tariff-uncertainty-geopolitical-tensions-3189235/
