Bengaluru — Gold prices edged down on Tuesday as market participants exercised caution and braced for US President Donald Trump’s tariffs on Canada, Mexico and China to go into effect within hours.
Spot gold edged down 0.3% to $2,885.40/oz by 3am GMT. US gold futures eased 0.2% to $2,895.40.
“This pullback is part of a broader shakeout in markets that could drive prices into the $2,700s before the primary uptrend continues,” Capital.com financial market analyst Kyle Rodda said.
It was a modest move down so far on Tuesday, Rodda said, adding that the clear deterioration in global trade relations and the weaker dollar on fears of a sudden slowdown in US growth had given the market a solid boost overnight.
Trump said on Monday that 25% tariffs on goods from Mexico and Canada will take effect from 5.01am GMT on Tuesday, along with a doubling of China levies to 20%, stoking fear of a trade war in North America and sending financial markets reeling.
Trump also said reciprocal tariffs would take effect on April 2 on countries that impose duties on US products.
Trump’s tariff plans are widely seen as inflationary, and have prompted increased safe-haven flow into bullion, which has gained about 10% so far for the year.
However, higher inflation may force the Federal Reserve to keep rates higher for longer, which would dent non-yielding gold’s appeal.
Markets are now awaiting ADP employment report due on Wednesday and the US nonfarm payrolls report due on Friday for more hints on the Fed’s rate trajectory.
JPMorgan said they hold a long-term structural bullish view for gold with price target of close to $3,000/oz in the fourth quarter of 2025.
Spot silver fell 0.6% to $31.5/oz, platinum lost 0.3% to $950.63, and palladium slipped 1.1% to $927.46.
Reuters
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