Gold compensated losses that incurred it earlier today, Wednesday, supported by the decline in the dollar and increased demand for safe haven investments, while markets continued to track the potential effects of the new customs fees imposed by US President Donald Trump.
Gold recorded in instant transactions 2414.59 dollars an ounce (ounce), in the latest transactions after its increase by 1% yesterday, Tuesday, in the latest transactions, while US gold futures rose 0.16% to $ 2925.20.
The dollar index, which measures the performance of the US currency against 6 main currencies, has declined to the lowest level in 3 months, which reduces the cost of gold for other currencies, but the returns of the standard American treasury bonds increased for 10 years, which reduced the attractive of the precious metal that does not generate return.
“I expect gold to remain one of the desired assets, while the uncertainty about international trade remains the prevailing feature of the market,” said Tim Waterwar, chief market analyst, Tim Water.
The new customs duties imposed by Trump by 25% on Mexican and Canadian imports came into effect on Tuesday, in addition to increasing customs duties on Chinese goods to homosexuals to 20%, which ignited commercial wars that could negatively affect economic growth and raise prices for Americans who are still suffering from years of high inflation.
China and Canada have responded with customs duties on a group of American goods, and Mexico is expected to respond on Sunday.
John Williams, President of the Federal Reserve in New York, said that American customs duties are likely to push inflation to rise, adding that the current interest rate policy is appropriate and does not need to be changed.
Being a safe haven investment, gold has risen more than 10% since the beginning of the year, somewhat supported by Trump’s policies, which are expected to enhance economic uncertainty, yet it may reduce the high interest rates from its attractiveness.
The markets are currently awaiting the recruitment report issued by the ADB Foundation later in the day and the non -agricultural job report in the United States on Friday.
China, the largest consumer of minerals, announced more financial stimulus measures, indicating greater efforts aimed at enhancing consumption as a way to support the path of the economy towards the targeted growth of this year of about 5%.
As for the other precious metals:
- Silver in instant transactions increased 0.74% to $ 32.21 an ounce.
- Platinum increased 0.64% to $ 969.20.
- Palladium rose 0.1% to 948.70 dollars.
Currency
The euro continued to rise today, Wednesday, and approached its highest levels in approximately 4 months after an agreement to establish a funds in Germany worth 500 billion euros (531 billion dollars) that led to improved growth forecasts in Europe, despite global trade tension that raises the concern of investors.
The euro has advanced 3% since the beginning of the week and has been going to achieve the best weekly performance since November 2022.
The unified currency rose again after the two parties that negotiate the formation of the next government in Germany announced on Tuesday to reach an agreement on the establishment of the infrastructure fund and mitigate financial rules related to the level of borrowing.
The euro rose 0.49% against the US currency today, Wednesday, to $ 1.0677, and strengthened its strength against other currencies, including the pound, the Pin, and the Swiss franc.
“The great shift we have seen in German fiscal policy gives a great deal of winds favorable to the euro to strengthen its strength in the near term,” said Lee Hardman,
He added: “Certainly, the market is currently taking into account … a more positive view of the European economy from now on, as financial motivation is likely to provide more support for growth in the coming years.”
But Hardman warned of the negative risks caused by US President Donald Trump’s threats to customs duties, saying that early April would be an “articulated stage” important to the European economy.
It is expected that the European Central Bank will reduce interest rates tomorrow, Thursday, and monetary firmness will continue in an attempt to support weak economic growth.
Other European currencies rose against the dollar, as the pound approached from the highest level in 4 months, recording 1.2852 dollars, an increase of 0.4% before it decreased slightly to $ 1.2827 during the day.
The dollar index, which measures the performance of the US currency, was scored for 6 main currencies its lowest level since November 11 at 105.08 points.
The dollar fell 0.2% against the Japanese currency, which is one of the safe haven investments to 149.52 yen, which is just higher than the lowest level in the 5 months that it recorded on Tuesday.
The Canadian currency settled at 1.4379 Canadian dollars for the dollar, away from the level of 1.479 Canadian dollars, which it got a month ago when customs duties were announced for the first time.
The yuan rose 0.03% to 7.2624 against the dollar. After China has declared more financial stimulus measures, indicating greater efforts aimed at enhancing consumption as a way to support the economy’s path towards the target growth of this year of about 5%.
