Gold prices pulled back slightly from record highs on Monday as markets digested a marginal improvement in global risk appetite. The move followed signals from the White House suggesting temporary relief on tariffs targeting Chinese electronics.
Spot gold slipped 0.3% to $3,225.79 per ounce, while June gold futures eased 0.1% to $3,240.87, after hitting a peak of $3,245.69 last week. Despite the dip, gold remains elevated, supported by ongoing economic uncertainty, a weaker U.S. dollar, and dovish commentary from Federal Reserve officials hinting at potential monetary easing.
Risk Appetite Rebounds on Tariff Exemptions
Markets found some footing after the U.S. announced that electronic imports from China would be exempt—for now—from the sweeping 145% tariffs proposed by President Trump. This development lifted Asian equity markets and U.S. stock futures in early trading, offering investors a reason to step back from safe-haven assets like gold.
However, caution remains:
- Trump reaffirmed plans for a 20% tariff on electronics
- A separate tariff package targeting tech goods is under preparation
- China retaliated with 125% tariffs on U.S. goods
- Beijing is actively exploring alternative trade alliances
The threat of an escalating trade war between the world’s two largest economies continues to weigh on long-term economic forecasts. Analysts say the tariff battle could impair global supply chains, prompting higher inflation and slower growth.
Goldman Sachs Ups Gold Forecast to $3,700
Amid the volatility, Goldman Sachs raised its 2025 gold price target to $3,700 per ounce, citing persistent safe-haven demand. The bank noted this is its third upward revision this year, driven by increased geopolitical risk and fears of a U.S. recession, which markets now estimate at a 50% probability.
In a more extreme scenario, Goldman warned that gold prices could reach $4,500 by the end of 2025, particularly if the trade war escalates further or global economic conditions deteriorate more rapidly than expected.
Other precious metals showed mixed performance:
- Platinum futures rose 0.8% to $951.90/oz
- Silver futures dipped 0.3% to $31.83/oz
- Copper steadied at $9,152.90/ton on the LME
The broader outlook for commodities remains tethered to geopolitical headlines and central bank policies, as investors brace for another week of volatility.
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