Gold Prices Hold Near Record Highs as Dollar Weakens, Haven Demand Persists

Gold prices remained steady during Asian trading hours on Friday, hovering close to record highs despite a shift towards riskier assets after U.S. President Donald Trump postponed plans for reciprocal tariffs.

However, steep losses in the U.S. dollar provided support for gold, as the greenback erased most of its recent gains following Trump’s announcement. Additionally, mixed U.S. inflation data boosted optimism for potential rate cuts later in 2025, further weighing on the dollar and bolstering gold prices.

• Spot gold steadied at $2,928.91/oz, while
• Gold futures (April contracts) rose 0.4% to $2,957.19/oz (as of 00:22 ET / 05:22 GMT).
• Spot gold remains just below its all-time high of $2,943.25/oz reached earlier this week.

Gold Set for Seventh Consecutive Weekly Gain

Gold prices are on track for a 2.4% weekly gain, marking the seventh straight week of advances. While risk appetite has improved following Trump’s tariff delay, uncertainty over his broader trade policies continues to support safe-haven demand for gold.

• Trump signed an executive order on Thursday, postponing reciprocal tariffs on major U.S. trading partners until April, providing more time for negotiations.
• However, he maintained a strong protectionist stance, having already imposed 25% tariffs on steel and aluminum imports earlier this week.

Key Market Drivers

1. Dollar Weakness Aids Gold
   • The U.S. dollar weakened, pressured by Trump’s trade policy shift and inflation data that raised hopes for Fed rate cuts later in the year.
   • A weaker dollar makes gold cheaper for foreign investors, boosting demand.
2. Haven Demand Remains Firm
   • While risk sentiment momentarily improved, markets remain cautious due to:
     • Uncertainty over Trump’s trade policies
     • Potential peace talks over Russia-Ukraine
     • Lingering inflation concerns
3. Interest Rate Speculation
   • Mixed U.S. inflation data has revived expectations of Fed rate cuts in late 2025, which could support further gold gains.

Market Outlook

Gold continues to see strong support from:

• Persistent haven demand amid geopolitical and trade policy uncertainties
• A weaker dollar
• Expectations for eventual Fed rate cuts

If gold breaks above its all-time high of $2,943.25/oz, it could signal further upside momentum, especially if inflation concerns persist and the Fed remains cautious on rate cuts.