Photo credit: uk.finance.yahoo.com
Gold prices soared to a new record high on Monday, reflecting growing investor concern regarding the rapid changes in U.S. trade policies, although the metal subsequently lost some of its gains.
As of 5:23:31 GMT-4, trading had commenced.
The price of bullion briefly exceeded $3,245 per ounce, breaking the earlier record set on Friday. This rise follows a significant increase of more than 6% last week, primarily driven by the weakened U.S. dollar.
Nevertheless, gold retraced from its peak, with futures trading at $3,244.70 per ounce and the spot price slipping by 0.3% to $3,231.03 per ounce at the time of reporting.
“Gold clearly stands to gain from the ongoing discussions surrounding the U.S. dollar, and we have seen the gold price in a strong upward trajectory,” commented Chris Weston, head of research at Pepperstone Group.
The surge in gold prices has been primarily attributed to a renewed demand for safe-haven assets, as global trade continues to face uncertainty after President Trump’s decision to escalate tariffs on Chinese imports, despite certain exemptions for consumer electronics.
Read more: FTSE 100 LIVE: Stocks rise amid mixed messages on Trump’s electronics tariff reprieve
On Sunday, Goldman Sachs announced an increase in its gold price forecast for 2025 from $3,300 to $3,700 per ounce, marking the third upward revision from the investment bank this year. The adjustment was influenced by heightened geopolitical risks and growing demand for safe investments amid economic uncertainty. In a more bullish scenario, Goldman suggested gold might reach up to $4,500 per ounce by 2025.
The bank also pointed to gold’s importance as a protective measure against increasing recession risks in the United States.
Meanwhile, the British pound experienced a rise of 0.5%, reaching $1.2852 against the dollar. This increase followed the announcement from the White House to exclude certain consumer electronics, such as smartphones and laptops, from the new tariffs on Chinese imports.
As of 10:33:35 BST, trading was underway.
This decision has been interpreted by markets as a sign of reducing trade hostilities between the U.S. and China, providing a moment of relief amid the ongoing fears of a global economic downturn.
The dollar continued to weaken, with the dollar index (DX-Y.NYB), which tracks the greenback against a selection of six currencies, falling by 0.7% to 99.36, marking its lowest point since April 2022.
Separately, the President revealed upcoming plans for tariffs targeting the semiconductor industry but indicated that some companies in the sector may receive flexibility.
“We wanted to simplify the situation for many companies, as we aim to manufacture our chips and semiconductors domestically,” Trump stated while speaking to reporters aboard Air Force One.
Story continues
These developments occur as China has implemented punitive tariffs on American products, raising duties on imports to 84%. In response, the U.S. has introduced its own tariffs on Chinese goods, with rates reaching an unprecedented 145%.
Analysts express concern that, despite some exemptions, the ongoing tit-for-tat tariffs could further erode investor confidence in the U.S. economy, especially given its reliance on essential materials from China.
At the same time, sterling also appreciated against the euro, increasing by 0.3% to €1.1544, aided by the dollar’s overall weakness and positive sentiment emerging from the tariff exemption news.
Oil prices remained stable on Monday, staying just above four-year lows as traders assessed the latest updates in the U.S.-China trade relationship alongside emerging signs of diplomatic progress between the U.S. and Iran.
As of 5:23:31 GMT-4, trading had begun.
BZ=F CL=F
Brent crude saw a slight increase of 0.3%, reaching $64.95 per barrel, while U.S. West Texas Intermediate (WTI) crude rose by the same percentage to $61.69 per barrel.
Crude oil prices have faced significant downward pressure recently, particularly in April, as escalating trade disputes have raised concerns about a potential global recession, negatively impacting energy demand projections.
However, optimism was sparked by reports of “constructive” talks between U.S. and Iranian officials. High-level negotiations in Oman over the weekend, the first since 2022, hinted at a possible thaw in relations and hope for a resolution regarding Iran’s nuclear ambitions. Both parties are expected to continue discussions.
Stocks: Create your watchlist and portfolio
Goldman Sachs anticipates that crude prices will remain under pressure due to slowing economic progress and increased output from OPEC+ nations. The bank forecasts that Brent crude will average $63 per barrel for the remainder of 2025, with WTI at $59. For 2026, projections suggest further declines to $58 and $55, respectively.
In terms of broader market trends, the FTSE 100 (^FTSE) rose by 2% to 8,119 points on Monday morning. For live updates, additional coverage is available.
Source
uk.finance.yahoo.com