Gold prices hit another record high on Tuesday, with the ounce reaching $4,170, driven by increased safe-haven buying from investors. This surge comes amid a tense global atmosphere, highlighted by the escalating trade war between the United States and China, as well as growing expectations of upcoming U.S. interest rate cuts.
The U.S.–China Trade War Reignites
Last week, U.S. President Donald Trump reignited the trade war by threatening a new round of tariffs on Chinese goods, alongside the imposition of export controls. In response, Beijing vowed to take countermeasures if Washington follows through. These tensions pushed investors toward gold as a hedge and protection against risk.
Fears Beyond Trade Disputes
Concerns are not limited to trade tensions. The ongoing partial shutdown of the U.S. government continues to cast a shadow over markets. U.S. Treasury Secretary Scott Bessent noted that the prolonged shutdown has already begun affecting economic activity, heightening uncertainty across financial markets.
Markets Await Fed Chair Powell’s Remarks
All eyes are now on Federal Reserve Chair Jerome Powell’s speech at the annual National Association for Business Economics (NABE) meeting, where investors hope he will provide clearer signals regarding the central bank’s policy direction. Market expectations show near certainty of rate cuts, with traders pricing in a 97% probability of a 25 basis-point cut in October and around 90% for another cut in December.
A Reflection of Global Anxiety
Gold has increasingly become the mirror reflecting global market anxiety. The more geopolitical and economic uncertainty rises, the stronger the rush to gold as a safe haven. With key Federal Reserve decisions approaching and trade tensions persisting, prices may continue to gain momentum—potentially reaching new record highs in the coming period.
