Gold climbs record high as Trump's tariff plans spark safe-haven demand

Uncertainty surrounding tariffs, potential for interest rate cuts, geopolitical conflicts and central bank buying have all played a role in fueling gold's surge in 2025.

Canadian Prime Minister Mark Carney said on Thursday he would respond with unspecified trade actions if Trump imposes new auto tariffs that have expanded a global trade war and hammered stocks.

All eyes are also on the reciprocal tariffs that Trump is set to implement on April 2, which could stoke inflation, dampen economic growth, and escalate trade disputes.

"We continue to hold a bullish outlook towards gold prices, with gold continuing to benefit from U.S. policy uncertainty, trade tensions, military conflicts around the world, inflation worries and macro uncertainty," BMI analysts said in a note.

Gold is traditionally seen as a hedge against economic and political uncertainty and often thrives in a low-interest rate environment.

Richmond Federal Reserve President Tom Barkin asserted that the Fed's current "moderately restrictive" monetary policy is appropriate, given high levels of uncertainty and rapid policy changes in the U.S. government.

The market awaits the U.S. Personal Consumption Expenditures data due later in the day, which could influence expectations for rate cuts this year, following the Fed's recent decision to hold its benchmark rate steady.

Spot silver fell 0.3% to $34.31 an ounce, platinum rose 0.3% to $988.45, and palladium firmed 0.1% to $976.5.