Gold prices rose in the European market on Friday, marking a third consecutive day of gains as safe-haven buying intensified following U.S. President Donald Trump’s announcement of a new round of tariffs.
The upside for the precious metal was capped by a stronger U.S. dollar in the forex market, amid growing signs of turmoil in global trade.
Expectations of a U.S. interest rate cut in September have increased after the minutes from the latest Federal Reserve meeting strengthened speculation of policy easing before year-end.
The Price
• Gold prices today: Gold rose by 0.6% to $3,343.88 per ounce, up from an opening level of $3,323.99, with an intraday low of $3,321.87.
• On Thursday, gold settled with a 0.3% gain, its second straight daily rise, supported by Trump’s tariff actions.
U.S. Dollar
The U.S. Dollar Index climbed 0.35% on Friday, posting its second consecutive daily gain and nearing a two-week high of 97.92 points, reflecting persistent strength against a basket of major and minor currencies.
As is well known, a stronger dollar makes dollar-priced bullion less attractive to holders of other currencies.
Trump Tariffs Shake Trade Outlook
Global trade chaos escalated after President Trump announced additional tariffs, stating his intention to impose broad-based duties of 15% or 20% on most of the United States’ trade partners.
Trump confirmed a 35% tariff on goods imported from Canada. In a post on Truth Social, he informed Canadian Prime Minister Mark Carney that the new tariffs will take effect on August 1 and may increase if Canada retaliates.
He also said the European Union could receive a tariff notice by Friday, casting doubt over the progress of U.S.-EU trade talks.
Brazilian President Luiz Inácio Lula da Silva said he hopes for a diplomatic solution to Trump’s threat of a 50% tariff on Brazilian imports, but vowed to respond in kind if the tariffs are enacted on August 1.
Trump additionally threatened a 50% tariff on imported copper and reiterated his intention to target semiconductors and pharmaceuticals with new tariffs.
U.S. Interest Rates
The minutes of the latest Federal Reserve meeting showed that most policymakers believed rate cuts would be appropriate later this year.
Following these details, and according to the FedWatch tool from CME Group, the probability of a 25 basis-point rate cut at the July meeting rose from 5% to 8%, while the probability of leaving rates unchanged fell from 95% to 92%.
The probability of a 25 basis-point rate cut at the September meeting increased from 62% to 72%, while the probability of keeping rates unchanged dropped from 38% to 28%.
Gold Outlook
• Tim Waterer, Chief Market Analyst at KCM Trade, said: “Despite the escalation of Trump’s tariff wars, gold hasn’t received the level of support it once did, as investors have grown accustomed to both the tariff narrative and Trump’s policymaking style.”
• He added that the simultaneousrise of the U.S. dollar and gold may have limited the precious metal’s upside.
SPDR Gold Trust
Holdings in the SPDR Gold Trust—the world’s largest gold-backed ETF—rose by 1.44 metric tons on Thursday, marking a second consecutive daily increase. Total holdings now stand at 948.81 metric tons, the highest since June 30.
