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Gold prices saw a slight increase on Monday, supported by persistent haven demand as uncertainty over upcoming U.S. trade tariffs and political developments in Japan added pressure to markets. The results of Japan’s upper house elections held over the weekend showed the ruling Liberal Democratic Party (LDP) losing its majority, casting doubt over the future direction of the country’s government. This resulted in some demand for safe-haven assets, such as the yen, which firmed after the election results.
Meanwhile, a mild pullback in the U.S. dollar, following a two-week ascent, also provided some support to metal markets, although gold remained confined within a $200 trading range since at least April. Despite the modest gain, gold continued to face challenges breaking out of its recent trading range.
Gold’s Response to U.S. Tariff and Trade Policy Concerns
Spot gold rose 0.4% to $3,364.21 per ounce, while gold futures for September rose 0.4% to $3,371.42/oz by 01:20 ET (05:20 GMT).
The price rise was influenced by growing uncertainty over the U.S. trade policy, as the European Union prepared retaliatory measures in response to President Donald Trump’s threatened trade tariffs. According to a report from The Wall Street Journal on Sunday, U.S. officials are demanding more concessions from the EU for a potential trade deal, including a baseline tariff rate of 15%. This news caught EU negotiators off guard, further escalating the uncertainty surrounding U.S. tariffs as the August 1 deadline for tariffs to take effect draws closer. Commerce Secretary Howard Lutnick confirmed that August 1 would be a firm deadline, with tariffs ranging from 20% to 50% on major economies.
Haven Demand Boosted by Political Uncertainty in Japan
Haven demand was further bolstered by Japan’s political outlook, as the LDP’s loss of majority control in the upper house complicates ongoing trade negotiations with the U.S. and raises doubts over Japan’s future economic policies. The loss of majority complicates Prime Minister Shigeru Ishiba’s ability to pass key reforms, leading to increased uncertainty that boosted demand for safe-haven assets.
Platinum and Silver Outperform Gold
While gold showed some mild gains, platinum and silver continued to outperform, driven by expectations of tightening supplies and improving demand. Spot platinum rose 1% to $1,439.59/oz, while silver saw a slight increase of 0.3%, reaching $38.3045/oz. Both precious metals have outpaced gold in recent months, with platinum nearing an 11-year peak and silver nearing a 14-year high. They have surged 29.2% and 53.5% respectively in 2025, compared to gold’s year-to-date gains of 28.4%.
Industrial Metals See Mild Gains
Among industrial metals, copper also saw some positive movement. Benchmark copper futures on the London Metal Exchange rose 0.6% to $9,846.45 a ton, while COMEX copper futures rose 0.2% to $5.6170 a pound. These price increases came amid signs of stronger global demand, particularly from China, the world’s largest copper importer.
Outlook
The outlook for gold and other precious metals remains largely tied to global trade and economic uncertainty. As U.S. tariffs and potential retaliatory measures from major trade partners loom, investors are likely to continue seeking safe-haven assets. However, the mixed performance of platinum and silver suggests that there are opportunities outside of gold in the precious metals market, especially as tighter supply and stronger demand expectations continue to support prices.
As geopolitical tensions, U.S. trade policies, and inflationary pressures continue to evolve, markets will likely remain volatile, keeping gold and other safe-haven assets in focus for the foreseeable future.
