New US trade barriers spark a rise in gold prices

Gold prices rose 0.4% on Thursday as trade tensions escalated following 25% tariffs on US auto imports. These new trade duties, set to take effect on April 2, were announced by President Donald Trump and are expected to have a significant economic impact. 

Speculations have been circulating among investors that the tariffs enacted by America could lead to higher inflation, slower economic activity and intensified geopolitical tensions. Market concerns have already sparked a rally in gold, which hit an all-time high of $3,057.49 an ounce on March 20.

Goldman Sachs has also adjusted its end-2025 gold price forecast from $3,100 to $3,300 an ounce. This revision reflects a notable increase in inflows into exchange-traded funds (ETFs) and sustained demand from central banks, both of which contribute to a more bullish outlook for the precious metal.

Investors are now eagerly awaiting the release of US consumer spending data on Friday, which could provide valuable insight into the future monetary policy. Despite hints of a new rate cut later this year, the Federal Reserve held it steady last week. 

Reuters reported that Minneapolis Fed President Neel Kashkari stressed that efforts to bring inflation down to the 2% target must continue.