Gold prices have climbed to a two-week high, exceeding $US3400 an ounce, spurred by escalating global trade tensions and growing anticipation of interest rate cuts in the United States. Spot gold experienced a 0.9 per cent increase, reaching $3400.44 an ounce during the early hours of the Australian trading session on Friday, marking its highest level since July 23. US gold futures also saw a significant rise, climbing 1.2 per cent to $3493.30.
The surge in gold prices coincides with the implementation of broad tariffs by President Donald Trump, which range from 10 per cent to 50 per cent and affect numerous countries. Additionally, a substantial 100 per cent tariff on imported semiconductors was announced on Thursday. These measures have amplified market uncertainty, despite some exemptions being available for companies committing to manufacturing within the US.
Gold is often considered a safe-haven asset, typically performing well during periods of economic uncertainty. It also tends to benefit from environments with low-interest rates. The current climate of trade disputes and potential monetary easing is therefore contributing to the increased demand and price appreciation of gold.
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