Gold Steadies Near Record High as Trump-Fed Tensions, Trade Risks Mount

Gold

Gold prices held firm in Asian trading on Tuesday, following a record-breaking rally the previous day. The yellow metal’s sustained safe-haven demand was fueled by intensifying U.S.-China trade tensions and concerns over President Donald Trump’s push to overhaul the Federal Reserve.

As of 20:17 ET (00:17 GMT), Spot Gold edged up 0.2% to $3,431.05 per ounce, while Gold Futures expiring in June surged 1.8% to $3,388.20 an ounce. Gold had previously jumped more than 3% to a record high of $3,444.57 per ounce on Monday.

The rally marked the third consecutive session of all-time highs for gold, driven by geopolitical instability, central bank stockpiling, and ongoing inflation concerns.

Adding to market volatility, Trump reiterated his demand for immediate interest rate cuts on Monday, warning that the U.S. economy could slow without monetary easing. This followed a statement by White House advisor Kevin Hassett that the administration was still reviewing the possibility of firing Fed Chair Jerome Powell.

Fed Chair Powell said last week that the central bank was not inclined to cut rates soon, pointing to risks of inflation and economic uncertainty from newly imposed tariffs. These developments raised questions over the Fed’s independence, shaking investor confidence and pushing the U.S. dollar to a three-year low. A weaker dollar typically lifts gold prices by making the metal cheaper for foreign investors.

Weak Dollar Boosts Metals as US-China Trade Conflict Deepens

Amid mounting trade tensions, China issued a stern warning to countries considering trade deals with the U.S. that could harm Chinese interests. The Ministry of Commerce in Beijing accused Washington of using tariffs and financial coercion to restrict China's global trade, warning of reciprocal actions if such deals go forward.

The warning follows the U.S. imposition of tariffs as high as 145% on Chinese imports, prompting retaliatory measures from China. These moves are escalating the Sino-U.S. trade standoff, a key driver behind investors’ flight to safe-haven assets like gold.

Other precious metals followed gold’s upward trajectory. Silver Futures rose 0.4% to $32.665 an ounce, while Platinum Futures added 0.3% to $969.40 an ounce.

In the base metals market, Copper Futures climbed to a two-week high, bolstered by dollar weakness. Benchmark contracts on the London Metal Exchange gained 0.7% to $9,289.60 a ton, and U.S. Copper Futures for May delivery rose 0.4% to $4.7390 a pound. Still, traders remained cautious due to the risk of additional U.S. tariffs targeting China—the world’s largest copper importer.