Gold Price Seeks Support as New U.S. Tariffs Fuel Market Volatility

Gold prices hovered near the $3,000 level on Tuesday as traders braced for the next wave of U.S. tariff hikes set to take effect at midnight. Market uncertainty remains high amid escalating trade tensions, supporting gold’s safe-haven appeal but also triggering volatility.

The most active June gold futures contract reached an intraday high of $3,037.90, before settling slightly lower at $2,998.30, down $0.50 or 0.02%. A softer U.S. Dollar provided brief support earlier in the session, though gold struggled to hold above key psychological levels.

Gold Market Reacts to Expanding Tariff Conflict

The global metals market continues to react sharply to the U.S. administration’s aggressive trade strategy. Volatility spiked after a White House official confirmed that the U.S. will implement up to 54% tariffs on Chinese goods, combining new measures with previous 20% tariffs announced in February amid the fentanyl crisis. These additional duties are set to begin at 12:01 a.m. EDT on Wednesday.

Last week, President Donald Trump overhauled the nation’s trade policy by introducing a 10% baseline tariff on nearly all imported goods. This marks a historic departure from the global trade framework that has shaped international commerce for over 75 years.

According to U.S. News, “Trump smashed a more than 75-year-old global trading system,” with additional reciprocal tariffs aimed at countries with barriers to U.S. imports.

Country-Specific Tariff Breakdown:

• China: 104% total tariff (new + existing)
• European Union: 20%
• Vietnam: 45%
• India: 26%
• South Korea: 25%
• Taiwan: 32%
• Thailand: 36%
• Brazil, Singapore, UK: 10% baseline tariff
• Canada & Mexico: Exempt (already subject to fentanyl-related tariffs)
• Russia: Surprisingly not included in the elevated tariff list, despite a $2.5 billion trade surplus in 2024

China, which posted a massive $295 billion trade surplus with the U.S. in 2024, had already imposed 34% retaliatory tariffs on U.S. imports. With Washington’s 104% tariff rate now looming, market participants are questioning how this trade war escalation could affect global growth and commodity demand.

Outlook for Gold Prices Amid Economic Uncertainty

Historically, gold benefits from geopolitical turmoil and recession fears. However, the initial market reaction to major policy changes like these can be mixed. Traders are now closely watching to see whether gold can reclaim and hold above $3,000, or if continued volatility will push prices lower in the short term.

With markets bracing for further global economic fallout, gold may soon reclaim its momentum as a safe-haven asset—especially if inflation rises and equity markets continue to struggle.

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