Gold Steadies After Falling Earlier on Trump Tariff Threats

Gold steadied after declining earlier as Donald Trump’s threat of 25% import tariffs on Canada and Mexico buoyed the dollar, Bloomberg reported.

The US president-elect said the import taxes were necessary to clamp down on migrants and illegal drugs crossing America’s borders. He also vowed to impose additional 10% tariffs on goods from China. The subsequent strengthening of the dollar made gold more expensive for many buyers.

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Bullion traded near $2,630 an ounce after slumping 3.4% in the previous session amid a potential easing of tensions in the Middle East. Israel’s security cabinet is expected to vote on a possible cease-fire deal with Hezbollah Tuesday, and passage is considered likely, an Israeli official said.

Yet gold is still up more than 25% this year, supported by central-bank purchases and the US Federal Reserve’s pivot to interest-rate cuts. Many analysts remain positive on the outlook, with Goldman Sachs Group Inc. and UBS Group AG seeing further gains in 2025.

Spot gold was little changed at $2,629 an ounce as of 10:19 a.m. in London. The Bloomberg Dollar Spot Index added 0.2%. Silver and palladium edged higher, while platinum fell.

A slew of economic reports this week may yield clues on the Fed’s likely rate path. These include minutes of the central bank’s November meeting, consumer confidence, and personal consumption expenditure data — the monetary authority’s preferred gauge of inflation.