Gold surges to new record high amid Trump tariff threats; spot gold at $2,953.12 per ounce

Gold prices surged to a record high on Thursday, surpassing the $2,950 per ounce mark, as investor demand for the metal increased amid concerns that U.S. President Donald Trump's tariff threats could trigger a global trade war.

As of 08:53 GMT, spot gold rose 0.7 per cent to $2,953.12 per ounce, after reaching $2,954.69 earlier in the session—marking its tenth record high this year. Meanwhile, U.S. gold futures increased by 1.2 per cent to $2,970.70.

Considered a safe-haven asset during uncertain times, gold has climbed 12 per cent since the start of the year.

"The $3,000 level seems to be having a magnetic effect on the market and even though by most considerations the market is technically overbought, it seems determined to crack that magic level," independent analyst Ross Norman, was quoted as saying by Reuters.

Norman further added, "The $2,950 is seen as the last chart resistance before the market elevates to challenge the $3,000 level and it is now looking like a question of when and not if."

What's behind the rally?

Trump stated that he would introduce tariffs on lumber, automobiles, semiconductors, and pharmaceuticals within the next month or even sooner, on Wednesday.

Since assuming office on January 20, he has implemented a 10 per cent tariff on Chinese imports and a 25 per cent tariff on steel and aluminum.

Additionally, Trump criticized Ukrainian President Volodymyr Zelenskiy, calling him a dictator. He urged Zelenskiy to act swiftly to achieve peace, warning that failure to do so could put his country at risk.

"While there is speculation that potential Ukraine-Russia peace talks could lead to some unwinding in gold, any weakness in gold may be temporary," IG market strategist Yeap Jun Rong, was quoted as saying by Reuters.

Additionally, minutes from the Federal Reserve's most recent policy meeting on Wednesday indicated that Trump's initial policy proposals had raised concerns about increasing inflation, supporting the central bank's decision to pause further rate cuts.

Meanwhile, spot silver gained 0.9 per cent to reach $33 an ounce. Platinum edged up 0.3 per cent to $974.85, while palladium climbed 1.4 per cent to $981.70.

(With inputs from Reuters)

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