Gold prices briefly climbed to an all-time high on Tuesday as markets weighed expectations for U.S. interest rate reductions alongside uncertainty surrounding President Donald Trump’s trade tariffs. This boosted demand for bullion as a safe-haven asset.
Other precious metals also posted strong gains, with silver surging to nearly a 14-year peak and platinum approaching an 11-year high. The moves came as the U.S. dollar dropped to a five-week low amid growing anticipation of lower interest rates.
Spot gold jumped 0.8% to a record $3,508.54 per ounce, while December Gold Futures hit $3,578.20/oz. By 03:27 ET, spot gold had eased slightly, trading 0.2% higher at $3,482.28/oz.
Tariff rulings and rate-cut bets drive precious metals
The rally was fueled by increased uncertainty over Trump’s tariffs after an appeals court deemed them unlawful last week. The ruling allows tariffs to remain in place until mid-October, though the president criticized the decision and intends to challenge it in the Supreme Court. This uncertainty, particularly regarding economic effects of tariffs implemented in August, reinforced demand for gold.
Expectations of a Federal Reserve rate cut in September further supported precious metals. CME FedWatch data showed nearly an 85% probability of a 25-basis-point reduction, even as the July personal consumption expenditures (PCE) index indicated inflation staying above the Fed’s 2% target. Fed Chair Jerome Powell had earlier hinted at a potential 25-basis-point cut but has not confirmed the move due to persistent inflation pressures.
Lower rates helped push the dollar down to a five-week low, giving additional support to non-yielding assets such as metals, which become more attractive relative to government debt when interest rates fall.
Among other metals, spot silver added 0.1% to $40.7545/oz, briefly surpassing the $40 mark for the first time since late 2011. Spot platinum rose 0.7% to $1,421.55/oz, staying close to an 11-year high. In recent months, silver and platinum have outperformed gold, as relatively lower prices per ounce and a consolidation in gold spurred speculative buying in both metals.
Industrial metals also showed gains. Copper prices rose despite somewhat disappointing PMI data from China, the world’s top copper importer, as investors speculated on potential stimulus measures. Benchmark copper futures on the London Metal Exchange gained 0.3% to $9,919 per ton, while COMEX copper futures advanced 0.4% to $4.5905 per pound.
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