Gold price (XAU/USD) are experiencing a significant upswing, continuing the momentum from a robust Tuesday where gains exceeded 1.20%. This bullish trend is largely attributed to comments from U.S. President Donald Trump regarding a 10% tariff on Chinese goods, which has sparked renewed interest in bullion as a safe-haven asset.
As investors digest the potential implications of the Trump administration’s tariff and tax cut policies, concerns are growing about their impact on the U.S. economy. Analysts warn that these measures could strain national finances and lead to an inflation surge, potentially limiting the Federal Reserve’s capacity to maintain its current easing monetary policy. Historically, higher borrowing costs have posed challenges for gold, given the inverse relationship between interest rates and bullion prices.
In Zimbabwe, gold exports surged to $1.44 billion last year, up from $1.22 billion in 2023, highlighting the country’s growing role in the global gold market. This increase is particularly noteworthy as silver futures also saw a brief spike following Trump’s tariff announcements, with Mexico—one of the top silver producers—remaining uncertain about how these tariffs might affect imports of the metal.
Meanwhile, U.S. Treasuries are facing pressure, with the 10-year benchmark yield hovering around 4.56%, close to its yearly low. This backdrop sets the stage for critical upcoming inflation data that could influence gold’s trajectory. Should inflation indicators reveal rising price pressures, profit-taking among gold traders may ensue, potentially pushing prices back towards Tech support levels around $2,668 and $2,649.
Technical Outlook – Gold Price
Currently, gold price is on track to reach $2,790, with analysts eyeing $3,000 as a longer-term target. However, immediate resistance is anticipated at $2,800 as traders remain vigilant for signs of a market correction amidst this rally.
while gold enjoys a favorable outlook driven by geopolitical tensions and economic policies, market participants must stay alert for inflation trends that could shift the dynamics in this precious metal’s pricing landscape.
Until then, Happy Trading!
Commodity Samachar Securities
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