Gold managed to stabilize above $3,300 after a bearish start to the week. Investors are now closely watching the upcoming US inflation data and fresh developments in US trade policy, which are likely to drive market sentiment in the near term.
Rising Risk Aversion Amid Trump’s Tariff Threats
US President Donald Trump announced that countries joining the BRICS group will face a 10% tariff. He also confirmed 25% tariffs on imports from Japan and South Korea, as well as 20%–30% tariffs on smaller trade partners like Algeria and the Philippines. These measures heightened market risk aversion, prompting investors to seek safety in gold.
Markets Await US Inflation Data
The US Consumer Price Index (CPI) for June is set to be released on Tuesday. A stronger-than-expected reading could reduce the chances of a Federal Reserve rate cut in September, potentially boosting the US dollar and weighing on gold prices. Conversely, weak economic indicators or escalating trade tensions could push gold higher as investors turn to safe-haven assets.
Conclusion
Gold remains in a critical position. While upcoming US economic data will shape the outlook for the dollar and gold, heightened uncertainty over US trade tariffs could fuel further demand for safe-haven assets. Traders should monitor both inflation figures and tariff-related headlines closely in the coming days.
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