Gold Prices Climb as Markets Weigh Impact of Trump’s Tariff Strategy

Gold Prices Surge as Trump’s Tariff Blitz Fuels Safe-Haven Demand

Gold prices climbed on Tuesday as investors flocked to the metal’s safe-haven appeal following the implementation of sweeping new tariffs by former U.S. President Donald Trump.

By 07:08 ET (12:08 GMT), spot gold gained 1.0% to $2,920.81 an ounce, marking its second consecutive session of gains. Gold futures also advanced, rising 1.1% to $2,931.49. Bullion has already surged 10% this year, briefly touching a record high of $2,956.15 on February 24 before retreating slightly due to profit-taking and supply concerns highlighted by UBS analysts.

Tariffs Shake Global Markets

Trump’s fresh round of tariffs, targeting imports from Canada, Mexico, and China, took effect at midnight Eastern time on Tuesday.

The new trade measures include a 25% tariff on all goods from Mexico and non-energy imports from Canada, while Canadian energy exports face a separate 10% duty. China was also hit with an additional 10% import tax, compounding a similar levy imposed in February.

The tariffs follow failed negotiations between the U.S. and its trading partners, as Trump remained firm on his demands for stricter border security and measures to curb the flow of fentanyl and migrants. “We’ve waited long enough. There’s no room left for deals,” Trump stated on Monday. He also criticized China for not taking “adequate steps” to combat the illicit drug crisis.

Retaliation Looms as Trade Tensions Escalate

The tariffs, affecting over $900 billion in annual U.S. imports from Canada and Mexico alone, have sparked warnings from economists and corporate leaders about potential disruptions to North America’s deeply integrated supply chains.

Canadian Prime Minister Justin Trudeau announced immediate retaliatory measures, imposing a 25% levy on $20 billion worth of U.S. goods, including bourbon, beer, wine, orange juice, and home appliances. If the U.S. duties remain in effect for 21 days, Canada will escalate its response with additional tariffs on $86 billion worth of American exports.

“Tariffs will disrupt an incredibly successful trading relationship,” Trudeau warned, adding that American consumers would face higher prices on essentials like groceries and gasoline.

Mexico’s President Claudia Sheinbaum signaled a multi-tiered response strategy but has yet to announce concrete countermeasures.

Meanwhile, Beijing condemned Trump’s trade moves as “unreasonable and groundless,” confirming plans to slap 10%-15% additional tariffs on select U.S. goods starting March 10.

Gold Shines Amid Market Uncertainty

With escalating trade tensions threatening economic stability, gold remains a preferred asset for investors seeking protection against volatility. Analysts expect bullion to continue its upward trajectory as geopolitical risks intensify and global markets brace for further retaliatory actions.