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Gold prices saw a sharp rise in Asian trading on Thursday, as safe-haven demand surged due to escalating concerns over potential military action with Iran and a risk-averse reaction to President Donald Trump’s comments on trade tariffs.
Spot gold rose 0.6% to $3,374.94 per ounce, while gold futures for August climbed 1.5% to $3,394.60 per ounce as of 01:24 ET (05:24 GMT). These gains came after the metal had already been on an upward trajectory this week, fueled by heightened uncertainty surrounding U.S.-China trade talks. Despite some progress in the negotiations, a lack of concrete details on the agreements left investors cautious.
Iran Tensions Drive Safe-Haven Demand
Tensions in the Middle East, particularly between Iran and Israel, acted as a key catalyst for gold’s rally. Reports indicated that Israel was preparing for a potential attack on Iran, especially if the nuclear talks with the U.S. stalled. Additionally, Trump confirmed that the U.S. was pulling personnel out of Iraq and other Middle Eastern nations due to growing fears of military action.
Iranian officials also raised alarms, threatening to strike U.S. bases in the region should conflict erupt. These headlines followed Trump’s comments, which suggested he was losing faith in the nuclear talks with Iran, specifically after stating that Iran would not be permitted to enrich any more uranium.
Despite these tensions, U.S. and Iranian officials are scheduled to hold more talks over the weekend, potentially offering a glimmer of hope for diplomatic progress.
Trade Concerns Weigh on Dollar and Support Metal Prices
On the trade front, risk appetite was dampened by Trump’s announcement that he would send letters outlining his trade tariff plans to major economies within the next two weeks. This statement dashed hopes for further U.S. trade deals, as the U.S. has only signed a trade deal with the U.K. and announced a trade framework with China this week, without providing substantial details.
These heightened uncertainties surrounding trade and geopolitical tensions pressured the U.S. dollar, benefiting broader metal prices. Platinum futures were a notable outperformer, rising 0.8% to $1,251.65 per ounce, a four-year high. Silver futures also gained, up 0.7% to $36.515 per ounce, staying close to a 13-year peak.
Industrial Metals Rise Amid Broad Metal Gains
In the industrial metals sector, copper prices saw moderate increases, with benchmark copper futures on the London Metal Exchange rising 0.5% to $9,699.70 per ton, while U.S. copper futures climbed 0.4% to $4.8242 per pound. These moves mirrored the broader strength in the metal markets as investor sentiment leaned toward risk-averse assets.
Platinum’s Rally May Be Short-Lived, Goldman Sachs Warns
Goldman Sachs analysts have cautioned that platinum’s recent rally, which saw the metal break out of a nearly decade-long trading range, may be short-lived. While platinum prices have surged by 37.3% so far in 2025, outpacing gold’s 28.6% rise, Goldman Sachs expects the metal to fall back within a trading range of $800 to $1,150 per ounce.
The analysts cited several factors weighing on platinum prices, including slowing Chinese consumer demand for platinum jewelry, weaker demand for emissions controls in the automobile industry due to the rise of electric vehicles, and strong production from South Africa, a key platinum producer.
Conclusion
Gold prices surged as investors sought safety amid rising geopolitical tensions and trade uncertainty. While concerns about military conflict with Iran and the lack of clear progress in U.S.-China trade talks boosted gold, other metals such as platinum and silver also saw gains, supported by weaker dollar sentiment. However, despite platinum’s strong performance this year, Goldman Sachs warns that its rally may soon lose steam, with the metal likely to return to a more traditional trading range.
