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Trump's tariff policy drives up gold prices

Trump's tariff policy drives up gold prices Photo: Trump raised gold prices to $3,100 (Getty Images)
Author: Liliana Oleniak

Gold prices exceeded $3,100 per ounce, hitting a record high. Fears of inflation due to US tariffs led the safe-haven asset to post its strongest quarter since 1986, according to Reuters.

Gold bullion continued its impressive rise, pushing the price of the metal up by about 18% since the beginning of the year.

On March 31, spot gold jumped 1.1% to $3,117 per ounce.

Last year, the price of precious metals rose by more than 27%. Many factors contributed to the growth of the safe asset, including a favorable monetary policy environment and active purchases by central banks.

“Gold's bull run is the reflection of the anxiety around tariffs. The fears that these tariffs are going to be growth constraining, potentially leading to lower economic outcomes,” said Nitesh Shah, commodities strategist at WisdomTree.

US President Donald Trump is expected to announce the retaliatory tariffs on April 2, with the automotive tariffs set to take effect on April 3.

A combination of other factors, including bets on lower interest rates, central bank purchases, and demand for exchange-traded funds, contributed to the record rise in non-bullion prices.

“Gold prices could be trading around $3,500 about this time next year and that reflects sentiment towards the metal remaining strong, primarily with all the geopolitical risks still there,” Shah said.

Trump said he was angry with Vladimir Putin and would impose secondary tariffs of 25-50% on Russian oil buyers if he believed Moscow was blocking his efforts to end the war against Ukraine.

Goldman Sachs has raised its forecast for the gold price at the end of 2025 from $3,100 to $3,300 per ounce. The investment bank believes that the ceasefire between Russia and Ukraine may briefly reduce the price.