Gold prices rebounded on Tuesday from a near four-week low reached in the previous session, as heightened concerns over the global trade war between the United States and its key trading partners lifted investor appetite for safe-haven assets.
Chris Ratcliffe | Bloomberg | Getty Images
Gold prices pulled back Tuesday, after rallying to a record as President Donald Trump‘s repeated threats against the Federal Reserve’s independence have shaken investors and undermined confidence in the U.S.
The precious metal was last down 0.85% to $3,396.10 as the stock market rallied on hopes that trade tensions between the U.S. and China would ease.
Gold futures hit a session high of $3,509.90 per ounce Tuesday, after closing at a record $3,425.30 on Monday. Gold has rallied nearly 30% since the start of the year and more than 7% since Trump announced sweeping tariffs on April 2.
Trump ratcheted up his public pressure campaign against Federal Reserve Chairman Jerome Powell on Monday, demanding he immediately lower interest rates and attacking him as a “major loser.” Equity markets sold off in response, with the Dow Jones Industrial Average falling more than 970 points.
Gold is viewed as a safe-haven asset in times of economic uncertainty. Central banks around the world have been adding to their gold reserves, supporting the precious metal’s rally this year.
“Gold has continued to serve as an effective hedge amid ongoing trade uncertainty,” analysts led by Mark Haefele, global wealth management chief Investment officer at UBS, told clients in a Tuesday note.
“Despite this strong performance, we see further upside potential,” Haefele said. “We continue to see support from investment demand, ongoing central bank diversification and a volatile macro backdrop.”
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