Gold prices remain in sight of record high as trade war fears fuel haven demand
Investing.com-- Gold prices steadied in Asian trade on Thursday, remaining close to record highs as persistent fears over a U.S.-China trade war kept safe haven demand for bullion largely in play.
Gains in gold were aided by a softer dollar, while U.S. President Donald Trump’s recent comments on the U.S. taking over the Gaza Strip also factored into haven demand.
Spot gold rose 0.1% to $2,869.17 an ounce by 00:27 ET (05:27 GMT), remaining just below a record high of $2,882.53 hit on Wednesday.
Gold futures expiring in April fell 0.2% to $2,887.90 an ounce.
Gold underpinned by trade war fears
Bullion prices were boosted chiefly by increased safe haven demand, after the U.S. imposed a 10% trade tariff on China earlier this week, drawing retaliation from Beijing.
The move ramped up concerns over an escalating trade war between the world’s biggest economies, given that Trump also signaled no hurry to negotiate with Chinese counterpart Xi Jinping.
JPMorgan analysts warned that their base case was for a continued escalation in the trade war, and that Trump could eventually deliver his promised 60% trade tariffs against China.
But higher U.S. tariffs are also expected to underpin domestic inflation, keeping interest rates high for longer. Such a scenario could limit gold’s long-term gains.
Other precious metals steadied on Thursday, but were also sitting on gains this week as the dollar wiped out all of its weekly gains.
Platinum futures rose 0.2% to $1,021.30 an ounce, while silver futures fell 0.8% to $32.708 an ounce.
Focus this week is now on key U.S. nonfarm payrolls data for more cues on interest rates. Any signs of resilience in the labor market could underpin the dollar and pressure metal prices.
Copper buoyed by some tariff relief, China stimulus bets
Among industrial metals, copper prices rose sharply on Thursday, extending recent gains on relief over Trump postponing tariffs against Canada and Mexico.
Traders were also watching for more stimulus measures from top importer China, as Beijing attempts to offset economic headwinds from a trade war with Washington.
Benchmark copper futures on the London Metal Exchange rose 0.8% to $9,341.70 a ton, while March copper futures rose 1.4% to $4.4985 to an over three-month high.