Gold Prices Hold Firm as Markets Await US Inflation Data; Trump Tariff Plans Under Scrutiny

Gold prices remained stable in Asian trading on Wednesday as investors exercised caution ahead of a crucial U.S. inflation report. Meanwhile, ongoing uncertainty surrounding former President Donald Trump’s tariff policies bolstered the yellow metal’s safe-haven appeal.

Gold Prices Hold Firm Amid Market Caution

Spot gold traded at $2,911.17 per ounce, showing little movement, while gold futures for April delivery remained steady at $2,921.24 an ounce as of 02:32 ET (06:32 GMT).

The stability in gold prices reflects a wait-and-watch approach by investors as they anticipate key U.S. economic data that could influence Federal Reserve policy.

US CPI Report to Shape Fed’s Rate Path

Market participants are eagerly awaiting the release of the U.S. Consumer Price Index (CPI), a critical inflation gauge that could provide insights into the Federal Reserve’s next steps regarding interest rates.

• Lower interest rates generally boost gold demand as they reduce the opportunity cost of holding non-yielding assets.
• However, Fed officials have signaled a near-term rate cut is unlikely, stressing the need to manage inflation risks—especially amid recent tariff escalations.

The Federal Open Market Committee (FOMC) is scheduled to meet on March 18-19 to decide on interest rates, making this inflation report a key factor in market movements.

Trump’s 25% Tariff on Steel & Aluminum Sparks Trade Concerns

A fresh wave of trade tensions hit global markets as Trump’s 25% tariff on all U.S. steel and aluminum imports officially came into effect on Wednesday.

Key Developments:

✔️ The tariffs impact various industries, from automobile manufacturing to beverage cans.
✔️ Trump initially proposed a 50% tariff on Canadian steel and aluminum in response to Ontario’s new trade restrictions.
✔️ After talks between Ontario Premier Doug Ford and U.S. Commerce Secretary Howard Lutnick, Ontario agreed to suspend a 25% surcharge on electricity exports to the U.S.
✔️ Consequently, the Trump administration withdrew the proposed 50% tariff, maintaining the existing 25% rate.

The enforcement of these tariffs has raised fears of an economic slowdown, prompting investors to seek safety in gold.

US Dollar Strengthens, Precious Metals See Mixed Action

The U.S. Dollar Index gained 0.2% in Asian hours, though it remained close to a four-month low hit last week.

Other precious metals posted muted gains:
🔹 Platinum Futures rose 0.2% to $988.05 per ounce.
🔹 Silver Futures climbed 0.3% to $33.240 per ounce.

Copper Prices Rise on Trump’s Tariff Reversal & China Stimulus Hopes

Copper prices edged higher on Wednesday after Trump rolled back his proposed tariff hike on U.S. imports of steel and aluminum.

Additionally, expectations of fresh economic stimulus from China boosted sentiment. The National People’s Congress recently concluded its annual session, fueling speculation of supportive economic policies from Beijing.

• London Metal Exchange Copper Futures gained 0.7% to $9,722.80 per ton.
• April Copper Futures ticked up 0.1% to $4.7995 per pound.

Final Thoughts

With the U.S. inflation report and Federal Reserve meeting on the horizon, gold prices are likely to remain in focus. Investors will be watching closely for any signs of policy shifts that could impact interest rates, the dollar, and overall market sentiment.

Stay tuned for further updates on gold, forex, and global trade trends.

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