Gold Prices Face Weekly Decline Amid Rising US Dollar
Gold prices are on track to record their first weekly loss of the year, as profit-taking occurs following a notable price increase. This downturn comes in the context of rising concerns regarding President Trump’s customs tariff policies, which have contributed to a robust strengthening of the US dollar.
As of the latest trading session, gold was priced around $2,875 per ounce, reflecting a 1.3% decline on Thursday. This drop follows Trump’s announcement of implementing customs tariffs on Canada and Mexico, effective March 4, along with potential additional charges on Chinese imports.
The US dollar observed a 0.6% rise, making gold less appealing to foreign investors, since gold is priced in dollars. The decline in gold prices in recent days follows a surge in demand for safe-haven investments, which had driven prices to a peak of $2,956.10 per ounce earlier this week.
Market apprehensions regarding the implications of Trump’s potential tariffs on US inflation, trade dynamics, the global economy, and geopolitical tensions underscore gold’s enduring role as a store of value during periods of uncertainty.
On Friday, investor focus will shift to the core personal consumption expenditures (PCE) price index data released by the United States, excluding food and volatile energy costs. This data is anticipated to provide insights into future monetary policy direction.
Analysts expect the index to show a deceleration to its slowest rate since June, which could bolster expectations for interest rate cuts—a development that generally favors non-yielding assets like gold.
As of 8:11 AM Singapore time, spot gold had dipped by 0.1% to $2,875.19 per ounce, marking a likely weekly decline of about 2%. The Bloomberg Dollar Spot Index remained stable, while other precious metals such as silver, platinum, and palladium experienced declines.
| Asset | Price (USD) | Change (%) |
|---|---|---|
| Gold | $2,875.19 | -0.1 |
| Silver | Declined | – |
| Platinum | Declined | – |
| Palladium | Declined | – |
| USD Dollar Index | Stable | – |
In summary, the intersection of protective measures in trade and shifts in monetary policy will continue to shape the landscape of precious metals, with gold’s position as a safe haven solidifying during volatile economic times.
