Gold prices surged to a new all-time high of $3,130 per ounce, extending its strongest quarterly performance since 1986. The precious metal continues to attract investors seeking a hedge against rising economic and geopolitical uncertainties, particularly as the U.S. braces for a new wave of tariffs introduced by President Donald Trump.
Unlike initial expectations, Trump’s tariff plan will not be limited to a select group of countries but will instead apply broadly to all U.S. trading partners. This sweeping measure, set to take effect on Wednesday, has raised fears of a full-scale trade war. Adding to market jitters, the administration plans to impose additional tariffs on automobile imports starting Thursday, further increasing pressure on global trade relations.
Gold’s rally, however, is not solely driven by trade concerns. The prospect of multiple interest rate cuts by the Federal Reserve has also played a key role in fueling demand for the metal. With inflationary pressures rising and economic indicators showing signs of weakness, investors are increasingly positioning themselves in gold, which historically thrives in a low-interest-rate environment. Central banks have also ramped up their gold purchases, while exchange-traded funds (ETFs) backed by physical gold have seen growing inflows, reflecting broader investor confidence in the metal’s continued strength.
Economic data from the U.S. has reinforced concerns over a potential slowdown. The manufacturing sector contracted in March, signaling weaker industrial activity, while job openings in February fell to 7.57 million, below the anticipated 7.63 million. These signs of economic strain have added to speculation that the Federal Reserve will move more aggressively with rate cuts in the coming months.
Investors are now turning their attention to Friday’s nonfarm payroll report, which could provide further insight into the strength of the U.S. labor market and the Fed’s potential monetary policy moves. If the data confirms a weakening economy, gold prices could continue their upward trajectory, reinforcing its role as a preferred safe-haven asset in times of uncertainty.