Gold prices edged higher on Wednesday, as market participants braced for U.S. President Donald Trump’s sweeping reciprocal tariff plans, which they fear would fuel inflation and hinder economic growth.
Spot gold rose 0.2% to $3,026.38 an ounce, as of 0721 GMT. U.S. gold futures gained 0.1% to $3,030.10.
“There are real concerns around U.S. economic growth as well as inflation. The U.S. is likely to face a stagflationary scenario, and that could support prices,” ANZ commodity strategist Soni Kumari said.
Focus is on potential reciprocal tariffs that the U.S. administration might adopt on April 2.
Trump’s tariff policies are likely to be inflationary, potentially slowing economic growth and intensifying trade tensions.
U.S. consumer confidence plunged to a more than four-year low in March, with households fearing a recession and higher inflation triggered by tariffs.
Gold, a hedge against geopolitical and economic instabilities, has risen over 15% so far this year, scaling an all-time peak of $3,057.21 on March 20.
Several Federal Reserve officials are due to speak later in the day. Markets also await U.S. personal consumption expenditures data on Friday for clues on monetary policy.
Non-yielding gold thrives in a low interest-rate environment.
“We are forecasting $3,200 by September,” Kumari said, adding that any hawkish comment from the Fed could be a factor slowing gold’s rally.
Elsewhere, the U.S. on Tuesday reached deals with Ukraine and Russia to pause their attacks at sea and against energy targets, with Washington agreeing to push to lift some sanctions against Moscow.
“Intermediate resistance for gold stands at $3,038, with next resistances coming in at $3,058 and $3,076/$3,090,” said Kelvin Wong, senior market analyst - Asia Pacific at OANDA.
Spot silver was steady at $33.75 an ounce and platinum lost 0.2% to $975.10. Palladium slipped 0.4% to $952.21.
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