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Gold prices remain stable as markets weigh potential impact of Trump’s policies
(MENAFN) Gold prices held steady on Tuesday as markets weighed the potential impact of U.S. President Donald Trump’s policies during his second term following his inauguration.
As of 0107 GMT, spot gold remained unchanged at USD2,707.19 per ounce, while U.S. gold futures dropped 0.7 percent to USD2,730 per ounce.
Global stocks rallied, and the U.S. dollar faced pressure after weeks of speculation about the tariffs Trump might implement on his first day in office. News that he would delay these measures offered some relief to markets.
Trump has proposed tariffs of up to 10 percent on global imports, 60 percent on Chinese goods, and 25 percent on products from Canada and Mexico. While gold is traditionally considered a hedge against inflation, Trump’s policies are expected to drive inflation, potentially leading the Federal Reserve to maintain higher interest rates, which could reduce gold’s appeal.
The extent to which Trump’s administration follows through on his promises will play a crucial role in shaping the future direction of U.S. interest rates. Gold, which does not yield interest, generally performs better in a low-interest-rate environment.
As of 0107 GMT, spot gold remained unchanged at USD2,707.19 per ounce, while U.S. gold futures dropped 0.7 percent to USD2,730 per ounce.
Global stocks rallied, and the U.S. dollar faced pressure after weeks of speculation about the tariffs Trump might implement on his first day in office. News that he would delay these measures offered some relief to markets.
Trump has proposed tariffs of up to 10 percent on global imports, 60 percent on Chinese goods, and 25 percent on products from Canada and Mexico. While gold is traditionally considered a hedge against inflation, Trump’s policies are expected to drive inflation, potentially leading the Federal Reserve to maintain higher interest rates, which could reduce gold’s appeal.
The extent to which Trump’s administration follows through on his promises will play a crucial role in shaping the future direction of U.S. interest rates. Gold, which does not yield interest, generally performs better in a low-interest-rate environment.
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