- Gold price rallies over 1.00% on Thursday after the US President left fresh tariff comments overnight.
- Trump signed a proclamation to implement 25% tariffs on auto imports.
- Gold traders keep buying Bullion as uncertainty rises.
Gold price (XAU/USD) surges higher on Thursday, gaining around 1.00%, trading at $3,050 at the time of writing. The pop in the precious metal was infused by United States President Donald Trump, who issued fresh new tariffs. Trump signed a proclamation for a 25% tariff on auto imports on Wednesday. The squeeze in Gold prices accelerates just hours ahead of the US trading session on Thursday.
In addition, President Trump suggested that further and mounting tariffs can be imposed on the European Union and Canada if both territories work together to “do the US economy harm”. Trump threatened with more levies on lumber, semiconductors and pharmaceutical drugs. All these new unleashed tariffs, levies and threats make the market’s assessment on what will actually come on April 2nd and 3rd, with the already announced reciprocal tariffs very unclear and full of contradictions.
Daily digest market movers: Ramping up forecasts
- President Donald Trump signed a proclamation to implement a 25% tariff on auto imports and floated further duties on the EU and Canada, expanding the trade war and triggering threats of retaliation. “What we’re going to be doing is a 25% tariff on all cars that are not made in the United States,” Trump said at the White House on Wednesday as he pushed ahead with a program seeking to bring more manufacturing jobs to the US, Bloomberg reports.
- Sibanye and Gold Fields are engaged in a high-stakes battle with the Rand West City Local Municipality over the valuations of the companies’ properties, setting off a tit-for-tat legal wrangle that has been raging for nearly a decade, according to an article on BusinessDay. Meanwhile, Gold Fields is still stuck in the acquisition bidding war with Australian miner Gold Road Resources.
- Goldman Sachs ramped up its Gold price forecast to $3,300 by year-end, citing stronger-than-expected central bank demand and solid inflows into bullion-backed exchange traded funds (ETFs).
Gold Price Technical Analysis: Set to break through
With the tariff picture for April 2nd now becoming even less clear, it makes sense for traders to reside in a safe haven spot, which is Gold, helping the bullish trend to continue.
On the upside, the daily R1 resistance for XAU/USD comes in at $3,030 and already got broken earlier this Thursday. Further up, the R2 resistance at $3,040 is just below Friday’s high. This means this level is a heavy barrier before pointing to the current all-time high of $3,057.
On the downside, the intraday S1 support for Gold price stands at $3,010, preceding the $3,000 mark, which can be perceived as a bullish sign. That means the $3,000 mark is no longer exposed and has some circuit-breaking element beforehand to slow down any downmoves. Further down, the S2 support comes in at $3,001, which coincides with the $3,000 marker psychological level.
XAU/USD: Daily Chart
US-China Trade War FAQs
Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living.
An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies.
The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
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