Gold climbs to three-week high amid tariff uncertainty

WASHINGTON: Gold surged more than 2 per cent on Monday, reaching a three-week high as investors turned to safe-haven assets amid renewed uncertainty over US tariff policy under Donald Trump.

Spot gold rose to $5,206.39 per ounce by early afternoon trading, after touching its highest level since January 30 earlier in the session. The metal previously hit a record $5,594.82 on January 29. Meanwhile, US gold futures for April delivery climbed 2.8 per cent to settle at $5,225.60.

The rally was driven by geopolitical and economic concerns, particularly after Trump signalled plans to raise tariffs following a US Supreme Court ruling against his earlier measures. He proposed increasing a temporary tariff on all imports from 10 per cent to 15 per cent, the legal maximum.

Market analysts say ongoing global uncertainty is strengthening gold’s appeal. Jeffrey Christian, managing partner at CPM Group, noted that a quieter market during the Lunar New Year could amplify price movements once trading activity resumes.

China, one of the world’s largest gold consumers, remained closed for the holiday and is expected to reopen on Tuesday, potentially influencing demand.

Looking ahead, analysts anticipate continued upward momentum in gold prices over the coming quarters, possibly reaching new record highs.

Recent U.S. economic data adds to the uncertainty. Inflation rose more than expected in December, while economic growth slowed sharply in the fourth quarter. This combination may push the Federal Reserve to keep interest rates elevated for longer.

Investors are now watching for signals from Federal Reserve officials this week, along with developments in global geopolitical tensions, including US–Iran relations.

Gold typically performs well during periods of economic instability and geopolitical risk, especially when interest rates are low, reinforcing its role as a key safe-haven asset.

Gold prices also rose in Pakistan today, following gains in global markets, with investors continuing to respond to market volatility and rising demand.

In local trading, the price of 24-carat gold per tola increased by Rs7,100 to reach Rs533,562. Similarly, the price per 10 grams rose by Rs6,087 to Rs457,443.

Silver prices also climbed, with the price per tola increasing by Rs374 to Rs8,948, while 10 grams rose by Rs321 to Rs7,671.