Gold prices moved slightly higher in early Asian trading on Tuesday, buoyed by persistent trade tensions and investor unease over mixed economic signals from China. Growing uncertainty around U.S. President Donald Trump’s aggressive tariff strategy continued to drive safe-haven demand, while patchy Chinese data further reinforced a cautious market tone.
Heightened geopolitical risks also lent support to bullion, as Washington expanded its military aid to Ukraine and warned of additional sanctions aimed at Russia’s energy sector.
Despite these tailwinds, gold prices remained range-bound, trading between $3,300 and $3,500 per ounce, with gains restrained by a firm U.S. dollar. Broader commodity markets were relatively subdued, with base metals showing limited movement. Investors now await key U.S. inflation figures, hoping for signals about the Federal Reserve’s next steps on interest rates.
Spot gold advanced 0.6% to $3,364.26 per ounce, while September futures added 0.4%, reaching $3,373.52 per ounce as of 01:44 ET (05:44 GMT).
Tariff Turbulence and Geopolitical Friction Boost Gold’s Appeal
The uptick in gold prices comes amid growing concern over a potential global trade standoff. Over the last week, Trump announced sweeping tariffs, including 30% duties on goods from Mexico and the European Union. The EU is reportedly readying a package of retaliatory measures, although Trump has signaled openness to further negotiations.
With just over two weeks remaining to reach a deal and prevent the tariffs from taking effect, markets remain anxious over the escalating trade rhetoric.
At the same time, geopolitical pressure intensified after Trump issued a 50-day ultimatum for Russia to end its war in Ukraine. The U.S. has also dispatched advanced weaponry to Kyiv, capable of reaching deep into Russian territory. Trump’s public criticism of President Vladimir Putin further fueled investor concerns, pushing more capital into safe-haven assets like gold.
Other precious metals, including silver and platinum, were largely unchanged on the day. Both had significantly outperformed gold in June but are now encountering resistance as momentum fades.
Dollar Holds Ground Ahead of U.S. Inflation Data
The dollar maintained recent strength during Asian hours, supported by investor focus on upcoming consumer price index (CPI) data out of the U.S. Markets expect modest increases in both headline and core inflation for June—figures that will be closely scrutinized for signs of tariff-driven price pressures.
Stubborn inflation may reduce the chances of aggressive interest rate cuts by the Federal Reserve, especially given policymakers’ stated preference for caution amid global trade uncertainty.
Copper Stabilizes After Mixed Chinese Growth Figures
Copper prices saw minor gains after a volatile start to the week, as traders weighed conflicting signals from China’s latest economic releases. On the London Metal Exchange, benchmark copper rose 0.2% to $9,642.20 per ton, while U.S. copper futures climbed 0.3% to $5.5460 per pound—recovering slightly from a recent slide off record highs.
China’s GDP for the second quarter came in at 5.2% year-over-year, slightly above expectations. The growth was driven by export strength and stimulus support, but it slowed from the previous quarter. While industrial production exceeded forecasts in June, retail sales and fixed asset investment missed projections, adding to concerns about domestic demand.
Analysts at ANZ noted that deflationary pressures remain a key headwind, suggesting that the government’s initial stimulus effects may wear off in the second half of the year.
As the world’s top copper consumer, China’s economic health has an outsized impact on global demand. However, some positive signals emerged as copper imports in June jumped 9%, ending a two-month streak of declines.
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.