Gold prices fell slightly in Asian trade on Wednesday, but remained close to record highs as U.S. President Donald Trump threatened to impose more trade tariffs on key imports to the country.
Uncertainty over interest rates also grew before more cues from the Federal Reserve this week, with the minutes of the central bank’s January meeting due later in the day.
Gold turned rangebound near record highs in recent sessions as markets grappled with some easing in haven demand, especially amid talks of a U.S.-brokered Russia-Ukraine peace treaty.
Markets also marked a relatively less pronounced negative reaction to Trump’s latest tariff threat, amid hopes that the President will use tariffs more as a negotiation tactic.
Spot gold fell 0.2% to $2,929.02 an ounce, while gold futures expiring in April fell 0.1% to $2,946.22 an ounce by 00:27 ET (05:27 GMT).
Trump flags 25% tariffs on autos, drugs, and chips
Trump on Tuesday evening said he will impose 25% tariffs on all automobile, pharmaceuticals and semiconductor imports, as he criticized allegedly unfair trading practices with other major economies.
Trump said the auto tariffs could come by as soon as April, while the drugs and chips tariffs will be delayed to provide companies with enough time to set up U.S. operations.
The latest tariff threat is part of Trump’s agenda to use import duties to further U.S. interests. The president reiterated his plans for reciprocal tariffs against major U.S. trading partners.
But risk-driven market saw a notably less negative reaction to Trump’s latest tariff threats, indicating that investors were growing somewhat resilient to the prospect of increased trade jitters.
Asian stocks clocked small losses, while U.S. stock index futures traded marginally higher on Wednesday.
Trump’s recent postponement of tariffs against Canada and Mexico also drove hopes that he will wield tariffs more as a negotiating tactic than actually imposing them.
Other precious metals retreated. Platinum futures fell nearly 1% to $1,000.95 an ounce, while silver futures fell 0.1% to $33.325 an ounce.
Among industrial metals, benchmark copper futures on the London Metal Exchange fell 0.5% to $9,418.95 a ton, while March copper futures fell 0.3% to $4.5710 pound. The red metal was hit with increased profit-taking after logging strong gains over the past week.
Fed cues, PMIs awaited
Metal markets were also awaiting more cues on interest rates this week, with the Fed set to release the minutes of its January meeting later on Wednesday.
The central bank kept rates steady and flagged a much slower pace of rate cuts this year, amid concerns over sticky inflation and policy uncertainty.
A slew of Fed officials are set to speak this week, and are widely expected to repeat the Fed’s messaging of no near-term rate cuts.
Beyond the Fed, focus this week is also on key purchasing managers index readings from the U.S. and other major economies, due in the coming days.
