Gold prices reached a new peak in early trading on Friday, aiming for gains for the fifth consecutive week, amid rising investor concerns regarding the potential imposition of customs duties by U.S. President Donald Trump. This comes as markets anticipate a critical inflation report that could provide insights into the trajectory of U.S. monetary policy set by the Federal Reserve.
In spot market transactions, gold prices rose by 0.1 percent to $2,795.92 per ounce as of 0035 GMT, marking a one percent increase for the week thus far. Earlier in the trading session, prices hit a high of $2,799.71.
On Thursday, President Trump announced plans to impose a 25 percent customs duty on imports from Mexico and Canada, reiterating previous warnings to both nations. Such measures are perceived as potential catalysts for rising inflation, possibly igniting trade disputes that may drive demand for safe-haven assets like gold.
Gold is frequently utilized as a hedge against both inflationary pressures and geopolitical uncertainties. Investors are now looking ahead to the release of U.S. Personal Consumer Price Index data for December, which is expected later on Friday.
Recent data indicated that U.S. economic growth slowed in the last quarter of the previous year; however, robust domestic demand may prompt the Federal Reserve’s Federal Open Market Committee to reassess its approach to monetary policy. On Wednesday, the Fed maintained its current interest rate, with Chair Jerome Powell indicating a cautious stance towards further rate cuts.
In Europe, the European Central Bank decreased borrowing costs by 25 basis points, in line with widespread expectations, while signaling the possibility of additional reductions.
In terms of other precious metals, silver saw an increase of 0.4 percent in spot transactions, reaching $31.54 per ounce, while platinum rose 0.1 percent to $967.80. Conversely, palladium experienced a decline of 0.2 percent, trading at $987.10.
Metal | Price (USD/ounce) | Change (%) |
---|---|---|
Gold | $2,795.92 | +0.1 |
Silver | $31.54 | +0.4 |
Platinum | $967.80 | +0.1 |
Palladium | $987.10 | -0.2 |