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"Gold Prices Surge to Record High Amid US-China Trade Tensions"

Economy Update – Baghdad

Gold prices surged to a record high on Wednesday, driven by concerns over the potential escalation of a new trade conflict between the United States and China, following China’s imposition of tariffs on American imports in retaliation to recent U.S. tariffs on Chinese goods.

In immediate trading, gold rose by 0.2 percent to $2,848.69 per ounce by 02:53 GMT, having previously peaked at $2,853.97 earlier in the session. U.S. gold futures also increased by 0.2 percent, reaching $2,879.70.

U.S. President Donald Trump indicated on Tuesday that he is not rushing to engage with Chinese President Xi Jinping to alleviate the growing trade tensions between the two nations, which together represent the world’s largest economies.

In a targeted response, China enacted customs duties on U.S. imports on Tuesday and notified several companies, including Google, of possible sanctions as a countermeasure to Trump’s tariffs.

Elia Spavak, head of global economics at acquisition firm, stated, “The next significant milestone for gold may be the $3,000 level… Should the trade conflict intensify, China may increase its gold purchases to bolster its reserves.”

Concurrently, three officials from the U.S. Federal Reserve cautioned on Monday that the Trump administration’s planned tariffs pose inflationary risks. One of the officials noted that uncertainty surrounding price expectations necessitates a more measured approach to interest rate adjustments than is typical.

Gold is often viewed as a hedge against inflation; therefore, higher interest rates may diminish its appeal among investors.

In addition, silver increased by 0.2 percent in immediate trades to $32.15 per ounce, platinum rose by 0.3 percent to $966.95, while palladium saw a decrease of 0.9 percent, falling to $981.75.

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