Gold rises after Trump’s tariffs: Will safe-haven rush push prices up

Gold prices rebounded on Thursday, July 31, snapping back from a one-month low after US President Donald Trump announced fresh tariffs that rattled global trade sentiment. This trade uncertainty has revived investor interest in gold, which is widely seen as a safe-haven asset during times of geopolitical and economic stress.

At 2:30 GMT, spot gold was up 0.5% at $3,292.24 per ounce, after dipping to $3,267.79 on Wednesday (July 30), its weakest level since June 30.

US gold futures edged lower by 0.2% to $3,287 per ounce, as some traders booked quick profits.
Gold prices in India today

In India, gold prices followed global cues and got an extra push from a weaker rupee. According to Goodreturns, the price of 24-karat gold is ₹10,049 per gram, 22-karat gold stands at ₹9,211, and 18-karat gold trades at ₹7,537 per gram.

Jateen Trivedi, VP Research Analyst at LKP Securities, said, “The trading range has now shifted higher to ₹98,500–₹1.01 lakh per 10 grams.”

What triggered gold’s bounce back?

Gold’s recovery comes after Trump announced new tariffs that unsettled global trade flows. The new measures include a 25% tariff on Indian goods effective Friday (August 1), a 15% tariff on imports from South Korea, and the end of an exemption for low-value shipments.

Trump also hinted at ongoing negotiations with China, saying he expects a fair deal soon.

Trade tensions often push investors towards gold as they seek safety from potential economic shocks and currency volatility.

Where does the Federal Reserve fit in?

The US Federal Reserve, which kept interest rates steady at its latest meeting, has complicated gold’s outlook. A rate hold normally limits gold’s upside because bullion doesn’t pay interest and competes with yield-bearing assets.

Ross Maxwell, Global Strategy Lead at VT Markets, noted, “The Fed held rates steady at 4.25%–4.50% as expected, but for the first time in decades there were two dissenting votes. Chair Jerome Powell said inflation is still above target and that no decision has been made for the September meeting. That has reduced near-term rate cut expectations and supported the US dollar, which typically pressures gold prices lower.”

Still, analysts say gold could hold firm.

Much depends on upcoming data, especially the US Core PCE index, which is the Fed’s preferred inflation gauge, as well as jobs and wage numbers due later this week.

Any sign of slowing inflation or weaker employment could revive hopes for rate cuts, giving gold another boost.

Domestic demand and festive season could keep gold firm

In India, domestic factors could cushion gold from global headwinds. Aksha Kamboj, Vice President of the India Bullion and Jewellers Association and Executive Chairperson of Aspect Global Ventures, said demand could remain strong.

“Gold may continue to attract buying interest at lower levels, supported by strong domestic demand ahead of the festive season and ongoing purchases by global central banks,” Kamboj said.

India remains one of the world’s top consumers of physical gold. Seasonal buying during festivals like Raksha Bandhan, Ganesh Chaturthi, and Diwali usually boosts demand from August to November.

–With Reuters inputs

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