Gold prices surged to new all-time highs on Thursday, driven by a weakening US dollar and deepening trade tensions between the United States and China. Investors turned to the safe-haven asset amid growing uncertainty, propelling both USD and AUD gold prices higher.
Spot gold jumped 2.6% to US$3,160.82 per ounce by 1:54 p.m. ET (17:54 GMT), after briefly touching a record intraday high of US$3,171.49. US gold futures also closed strongly, rising 3.2% to US$3,177.50.
In Australian dollar terms, gold broke through AU$4,870 an ounce, buoyed not only by the metal’s global rally but also by continued pressure on the local currency against the US dollar. The AUD gold price remains an important benchmark for Australian investors and sellers, many of whom are benefiting from the dual effect of rising global demand and a softer Aussie dollar.
The rally was spurred in part by US President Donald Trump’s announcement on Wednesday that, while he would temporarily reduce tariffs on a group of countries, levies on Chinese imports would increase dramatically—from 104% to 125%. The policy shift rekindled fears of a prolonged and damaging trade war, sending investors scrambling for safe assets.
“Gold is back in favour as a go-to hedge in times of global uncertainty,” said Nikos Tzabouras, Senior Market Analyst at Tradu.com. “That said, any breakthroughs in trade negotiations or a shift in Federal Reserve expectations could weigh on this momentum.”
Indeed, the US dollar index dropped more than 1%, making gold more attractive to holders of other currencies, while US inflation data released Thursday showed an unexpected fall in consumer prices during March. Despite the dip, inflation risks remain tilted to the upside due to Trump’s tariff escalation, and markets are increasingly betting that the US Federal Reserve will resume cutting rates, with a full percentage point reduction expected by year-end.
“Central banks are continuing to buy gold, and as long as that’s paired with ETF inflows and monetary policy uncertainty, we can expect robust support for the metal,” said Alex Ebkarian, COO at Allegiance Gold.
While gold led the charge, other precious metals were mixed. Spot silver eased 0.5% to US$30.88 an ounce, platinum dropped 0.5% to US$932.41, and palladium fell 1.4% to US$918.45.
