Gold hits record just below US$3,000 as US economic fears stoke haven demand
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Spot gold traded at US$2,983.50 an ounce at 2.19pm in Singapore, up 14 per cent this year.
PHOTO: REUTERS
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MELBOURNE – Gold rose to a record - coming within a whisker of US$3,000-an-ounce - as President Donald Trump’s aggressive tariff agenda fanned concerns about the potential hit to growth, hurting demand for risk assets and aiding flows into bullion-backed funds.
Spot gold climbed toward US$2,994 an ounce on March 14, eclipsing the previous peak set the previous day.
It traded at US$2,983.50 an ounce at 2.19pm in Singapore, up 14 per cent this year.
Bullion has risen 2.6 per cent this week, putting it on track for the biggest gain since November. Futures in New York - which trade at a premium to cash prices - comfortably topped US$3,000 an ounce.
The precious metal has performed robustly this quarter, extending a strong annual gain in 2024, as the US administration’s aggressive trade agenda damped appetite for risk assets including shares, with the k ey S&P 500 equity gauge entering a correction
Bullion’s advance has also been supported by central-bank buying, inflows into exchange-traded funds, and a wave of bank forecasts that greater gains may lie in store.
Global holdings in bullion-backed ETFs rose to about 2,687 tons, according to a preliminary Bloomberg tally. That’s the most since November 2023.
Among moves on trade, Trump threatened to enact a 200 per cent tariff on European wine, champagne and other alcoholic beverages. He also said he would not repeal levies on steel and aluminium that took effect this week, nor back off plans for sweeping reciprocal tariffs on global trading partners set to start as soon as April 2.
“The psychological US$3,000 level is now coming into view for gold prices, and as we approach the second quarter, where reciprocal tariffs could trigger another wave of market turbulence, gold remains a compelling safe-haven asset in an environment where alternatives are scarce,” said IG market strategist Yeap Jun Rong.
Banks are increasingly confident that Mr Trump’s disruptive trade policies, coupled with other concerns, will drive further gains in gold. This week, Macquarie Group forecast for a spike to US$3,500 an ounce in the second quarter, while BNP Paribas raised its outlook to show average prices well above US$3,000. BLOOMBERG
