Gold prices have been significantly rising amid volatile market dynamics and potential tariff war

Recently, gold prices have witnessed a significant rise, driven by a combination of geopolitical tensions, economic uncertainties, and market dynamics. Fears of a potential tariff war between the US and other countries have played a major role in boosting gold's appeal as a safe-haven asset. In response to US duties on Chinese goods, China imposed tariffs on US imports, escalating trade tensions and prompting investors to seek refuge in gold. Additionally, a weaker US dollar has made gold more attractive for international buyers, further supporting the price rally.

Inflation risks and uncertainty surrounding Federal Reserve policies have also contributed to the rise in gold prices. As a traditional hedge against inflation, gold has gained traction amid concerns over rising prices and potential interest rate hikes. The situation was further intensified by US President Donald Trump's announcement of plans to impose reciprocal tariffs, which heightened global trade concerns. Trump's imposition of a 10% tariff on Chinese imports and threats of tariffs on Canada, Mexico, and key industries such as cars and pharmaceuticals have added to the economic uncertainty. The prospect of rising US tariffs and potential retaliation from other countries has raised fears of slowing global economic growth, further driving demand for gold.

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Investors have responded to these developments by flocking to gold, with increased inflows into gold exchange-traded funds (ETFs). This surge in demand, coupled with the metal's role as a safe-haven asset, has solidified its position as a preferred investment during times of economic and geopolitical instability.