By Rahul Paswan
(Reuters) – Gold prices extended gains on Tuesday, driven by safe-haven demand as trade conflicts erupted after U.S. President Donald Trump imposed new tariffs on top three trading partners of the world’s biggest economy.
Spot gold rose 0.8% to $2,917.61 an ounce by 0939 GMT, up for a second straight session. Bullion has gained 10% so far this year and hit a record high of $2,956.15 on February 24.
U.S. gold futures rose about 1% to $2,928.90.
Trump’s new 25% tariffs on imports from Mexico and Canada took effect at 0501 GMT. He also doubled duties on Chinese goods to 20%. China hit back immediately with additional tariffs of 10%-15% on certain U.S. imports from March 10 and a series of new export restrictions for designated U.S. entities.
“With Trump 2.0 delivering exactly the chaos he promised in the U.S. election, Western investors are joining emerging-market central banks in buying gold as an all-weather hedge,” said Adrian Ash, head of research at online marketplace BullionVault.
Traders now await the ADP employment report due on Wednesday and the U.S. nonfarm payrolls report on Friday for clues on the Federal Reserve’s interest-rate trajectory.
“Any indication of a slowdown in the U.S. economy would support calls for more Fed rate cuts and support the gold price. We continue to look gold to re-test the highs over the coming weeks,” UBS analyst Giovanni Staunovo said.
The U.S. central bank held interest rates steady in its last meeting. It is expected to resume cutting rates in June and could reduce short-term borrowing costs again in September.
J.P.Morgan said it expects gold close to $3,000 an ounce by the fourth quarter of 2025.
Spot silver added 0.4% to $31.80 an ounce, platinum firmed 0.2% to $954.81 and palladium gained 0.3% to $940.80.
(Reporting by Rahul Paswan and Ashitha Shivaprasad in Bengaluru; Editing by Shilpi Majumdar)
