Gold prices have risen to the highest level ever during today’s dealings after US President Donald Trump’s plan to impose new customs duties raised fears of a global trade war, which increased demand for safe haven.
Gold in instant transactions increased by 1.54% to $ 2904.37 an ounce, in the latest transactions, at the seventh peak recorded by the yellow metal this year.
US gold futures rose 1.43% to 1928.80 dollars.
Folding fears
“Trump’s announcement will impose new customs duties that increase inflation and fuel concerns about economic growth. We expect more prices and the continued rise of gold towards the level of 3 thousand dollars,” said Juveni Stownovo.
Trump said on Sunday that he will announce new customs duties of 25% today, Monday, on all steel and aluminum imports to the United States, which will be added to the current customs duties on metals, in another major escalation of its commercial policy.
Trump also said that he intends to announce customs duties on many countries tomorrow, Tuesday or Wednesday, to enter into force almost immediately, to be applied to all countries and the similarity of what each country imposes on the United States.
Federal Reserve officials (the US Central Bank) said last Friday that the lack of clarity on Trump’s policies and how it would affect economic growth and inflation that is still high that enhances the approach to the delay in reducing interest rates, especially with the US labor market remaining on its durability.
Safe investing
Gold is used as a safe investment in times of political and financial ambiguity, but high interest rates reduce the return of the metal that does not generate returns.
“I do not see any high possibility of a correction so far at this stage, unless we start seeing a kind of strong height of the US dollar,” said Calvin Wong,
Gold is a safe haven because it maintains its value or rises in times of economic or political instability, for several reasons:
- Stable value, and maintains its long -term value, unlike paper currencies that may lose their value due to inflation or economic crises.
- Protection of wealth and hedging against inflation, when prices rise in general, the purchasing power of currencies decreases, while gold often rises.
- Continuous global demand, gold is required all over the world, whether for investment, jewelry, or industries, which enhances its stability as a safe origin.
- It is not related to other financial assets, in times of crisis, such as the collapse of financial markets, wars, or political turmoil, stocks and currencies can decrease, but gold often rises because it is seen as a reliable investment.
- Reserves for central banks, many central banks retain gold as part of their reserves to ensure financial stability, which enhances its position as a safe haven.
andFor other precious metals, its performance was as follows in the latest transactions:
- Silver increased in instant transactions 1.57% to $ 32.31 an ounce after it rose to the highest level since November on Friday.
- Platinum increased 0.9% to 985.05 dollars.
- Palladium rose 1.2% to 976.25 dollars.
