Gold prices soared above $3,100 per ounce for the first time on Thursday, driven by heightened demand for safe-haven assets after U.S. President Donald Trump imposed a 25% tariff on all automobile imports. The latest escalation in trade tensions rattled global markets, triggering sell-offs in equities and fueling concerns over a broader economic slowdown.
Spot gold climbed 1.2% to $3,056.60 per ounce by 5:24 PM ET, after briefly touching a record high of $3,059.30. Gold futures for May delivery surged 1.5% to settle at $3,099.20, setting another all-time high. The rally was further bolstered by a Goldman Sachs price upgrade, with the bank lifting its 2025 gold forecast based on expectations of increased central bank purchases and stronger ETF inflows.
Trump Tariffs Drive Risk-Off Sentiment
While gold initially saw some profit-taking earlier in the week, the latest tariffs renewed investor fears, reinforcing gold’s appeal as a hedge against economic and geopolitical instability.
- Trump’s auto tariffs impact major economies, including Japan, the EU, and South Korea.
- Analysts warn that higher tariffs could increase U.S. car prices and fuel inflation.
- The U.S. President has hinted at more trade measures, targeting commodities, semiconductors, and pharmaceuticals.
The global response was swift, with Europe, Canada, China, and Mexico condemning the tariffs and threatening retaliatory actions. Concerns over a potential trade war and its impact on global economic growth continued to weigh on risk assets, prompting investors to shift toward gold and other precious metals.
Goldman Sachs Raises 2025 Gold Target
Goldman Sachs revised its year-end 2025 gold price forecast to $3,300 per ounce, citing:
- Aggressive central bank buying, particularly in Asia and emerging markets.
- Sustained ETF inflows as investors seek inflation hedges and economic protection.
- Potential recessionary risks, which could drive gold as high as $3,680 per ounce.
Other precious metals followed suit, with platinum futures up 2.07% to $989.40/oz and silver futures jumping 3.2% to $35.32/oz. Industrial metals saw mixed reactions, with U.S. copper futures falling 2.3% to $5.12 per pound, despite hitting record highs earlier in the week on supply concerns tied to Trump’s tariff agenda.
As trade tensions escalate, gold remains the preferred hedge against uncertainty, with analysts forecasting continued strength in the market.