Gold Rises in Asia as Trade Tensions with China Spur Safe-Haven Demand
Gold prices climbed in Asian markets on Monday, buoyed by growing demand for safe-haven assets amid renewed strains in U.S.-China trade relations and persistent uncertainty surrounding President Donald Trump’s tariff policy.
Broader metals markets also saw modest gains, helped by a weaker U.S. dollar after Federal Reserve Governor Christopher Waller expressed support for interest rate cuts later in the year.
As of 00:53 ET (04:53 GMT), spot gold increased by 0.8% to $3,315.68 per ounce, while August gold futures gained 0.7% to $3,338.52 per ounce.
Safe-Haven Demand Grows on Renewed Trade Friction
Gold and other traditional havens rose as rising U.S.-China trade tensions and Trump’s threats to escalate tariffs on key commodities prompted investors to pull back from riskier assets.
On Monday, Beijing pushed back against Trump’s accusations that it had breached a recent trade agreement signed in Geneva, stating it would defend its national interests. Trump made the allegations over the weekend, though his administration did not clarify the specific violations.
Last week, U.S. officials acknowledged that trade negotiations with China had stalled, even as Chinese officials continued to criticize U.S. restrictions on their semiconductor industry, which they claim violate the Geneva deal.
The strained rhetoric lowered expectations of a lasting trade resolution, and raised the likelihood that tariffs could intensify in the near term.
Adding to investor anxiety, Trump announced plans to double tariffs on steel and aluminum imports, from 25% to 50%, further stoking fears over the health of the U.S. economy.
Dollar Dips, Metals Supported by Fed Rate Cut Signals
Metals received an additional boost from dollar weakness, following Waller’s comments suggesting a dovish outlook for monetary policy.
Waller noted that the impact of Trump’s tariffs on the U.S. economy had been limited so far, and that they were unlikely to significantly affect inflation. Combined with cooling inflation and a strong labor market, this could give the Fed the room it needs to cut rates.
However, he cautioned that any easing would still depend on whether tariffs stabilize and don’t escalate further. He also flagged economic headwinds, citing recent volatility in the Treasury market.
Following Waller’s remarks, the U.S. dollar dipped 0.1% in Asian trading, providing support to dollar-denominated commodities.
- Silver futures rose 0.6% to $33.220 per ounce
- Platinum futures underperformed, falling 0.5% to $1,050.10 per ounce
In the industrial metals space, copper futures on the London Metal Exchange gained 0.7% to $9,580.85 per ton, despite weaker-than-expected Chinese PMI data for May, which signaled ongoing softness in the country’s economy—the world’s largest copper consumer.
