Gold (XAU/USD) edge higher to touch $3,341.40 in Asian trade before slipping back to $3,333.80 by mid-morning in London. After a choppy few days, the metal looks set to secure a weekly gain, its first after two straight weeks in the red.
Gold is drawing support from growing concern over the US fiscal outlook and fresh uncertainty around upcoming trade tariffs. Trump’s tax-slashing, defence-boosting megabill is now on his desk, with the CBO projecting it’ll add $3.4 trillion to the national debt. That kind of hole in the public purse tends to keep gold well bid, especially when paired with simmering tariff risk.
And the tariff risk is now very real. Trump says the US will start notifying over 170 countries of new flat-rate export tariffs, between 20% and 30%, as soon as today. With just a couple of trade deals secured so far, markets are bracing for a broad escalation.
Yesterday’s rally was cut short by a stronger-than-expected US jobs report, which stalled gold’s momentum. Rate-cut bets for July were pared back, sending yields up and gold down nearly 1% on the day.
Still, with fiscal and trade concerns doing the heavy lifting, gold’s safe-haven narrative remains alive, just a little more complicated now that the Fed’s next move is back in question.