Gold rose early Monday, rebounding after last week’s fall and attracting haven investors as U.S. President Donald Trump prepared to impose new tariffs against the nation’s largest trading partners.
Trump said last week he would implement 25% tariffs on Canada and Mexico on Tuesday and said he would levy additional 10% duties on goods from China, making some investors question the economic outlook. Gold also rose amid ongoing concern about U.S. inflation. The Federal Reserve’s favorite inflation measure came out Friday and showed that core prices of goods were in line with expectations.
Many world leaders and investors were also caught off guard by Trump and Vice President JD Vance’s encounter with Ukrainian President Volodymyr Zelenskyy in the Oval Office on Friday and the move’s potential to fray the Western alliance that’s been in place since just after World War II.
April gold futures fell 3.6% last week to settle at $2,848.50 an ounce on Comex after the most-active contract lost 1.6% Friday. Bullion rose 0.5% last month after gaining 7.3% in January and dropping 1.5% in December. The metal rose 27% in 2024, its biggest annual gain since 2010. The April contract is currently up $36.00 (+1.26%) an ounce to $2884.50 and the DG spot price is $2881.00.
The personal consumption expenditures price index, the inflation measure that came out Friday, showed that the core measure – excluding volatile food and energy prices – rose 0.3% in January and 2.6% year on year. The top-line figure increased 0.3% for the month and 2.5% year on year.
The figures may allow the Fed to continue to keep interest rates on hold. The Fed cut rates three times in 2024, but most investors aren’t pricing in a Fed rate reduction until June, according to investors tracked by the CME FedWatch Tool. About 95% expect rates to remain unchanged in March, compared with 5% anticipating a 25 basis point cut.
The Fed kept its benchmark interest rate at 4.25% to 4.50% in January. It was the central bank’s first policy meeting since July 2024 without a rate cut after three reductions last year. Previously, the Fed had kept rates at 5.25% to 5.50% for a year after raising them by 5.25 percentage points since March 2022 to combat inflation.
The key U.S. weekly jobs report is scheduled for release Friday. The Fed has said it closely watches both inflation and the labor market when determining monetary policy.
Front-month silver futures fell 5.5% last week to settle at $31.50 an ounce on Comex after the May contract lost 1.9% Friday. Silver retreated 2.4% in February after adding 10% in January and dropping 6% in December. It gained 21% in 2024. The May contract is currently up $0.814 (+2.58%) an ounce to $32.310 and the DG spot price is $31.86.
Spot palladium lost 5.5% last week to $929.00 an ounce after falling 0.3% Friday. Palladium retreated 10% in February after advancing 11% in January and falling 6.7% in December. Palladium dropped 17% last year. Currently, the DG spot price is up $45.10 an ounce to $967.00.
Spot platinum slid 3.3% last week to $943.50 an ounce after declining 2% Friday. Platinum slid 4.7% last month after gaining 8.4% in January and losing 4.6% in December. Platinum slid 8.4% in 2024. The DG spot price is currently up $40.50 an ounce to $975.40.
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