On Tuesday, spot gold rose to $3,508.50 per ounce, extending a rally that has lifted the metal by nearly one-third this year. Traditionally seen as a safe haven in turbulent times, gold gained further momentum earlier in the year after US President Donald Trump introduced sweeping tariffs that unsettled global trade. Analysts say expectations of a potential interest rate cut by the US Federal Reserve have also boosted demand, as lower rates make gold more attractive compared to other assets.
Adrian Ash, research director at BullionVault, told the BBC’s Today programme that Trump’s actions had been a key driver behind the surge. It’s really down to Trump what he’s done to geopolitics and what he’s done to global trade,” he said, adding that last year’s US election “really put a fire under it.”
Concerns over the Federal Reserve’s independence have added to investor unease. Trump has repeatedly criticized Fed chair Jerome Powell and even attempted to remove one of its governors, Lisa Cook. Derren Nathan of Hargreaves Lansdown said Trump’s efforts to undermine the central bank were “driving renewed interest in safe-haven assets including gold.
European Central Bank President Christine Lagarde echoed those concerns on Monday, warning that any move to weaken the Fed’s independence would pose a “very serious danger” to the global economy.
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