Gold prices surge to record high amid tariff tensions and inflation fears

Gold prices reached an all-time high on Friday, 14 February, as heightened demand for safe-haven assets pushed the yellow metal closer to the crucial USD 3,000 mark.

Investors flocked to gold amid growing uncertainty over US tariffs and escalating trade tensions. The possibility of easing the monetary policy of the US Federal Reserve further bolstered the appeal of precious metals.

Spot gold slightly eased by 0.1 per cent, to USD 2,983.78 per ounce, after hitting a record high of USD 2,990.09 earlier in the session. The bullion is on track to record a second consecutive weekly gain, with a rise of 2.5 per cent so far. Meanwhile, US gold futures climbed 0.2 per cent to USD 2,996.70 per ounce.

Other precious metals saw mixed movements, with spot silver dipping 0.2 per cent to USD 33.72 per ounce, platinum inching up 0.1 per cent to USD 995.30 per ounce, and palladium gaining 0.7 per cent to USD 964.32 per ounce.

Back home, the Indian commodity and stock markets remained closed on Friday in observance of Holi 2025. The commodity markets are set to resume trading at 5 p.m.

On Thursday, 13 February, the Multi Commodity Exchange (MCX) saw gold prices closing flat at Rs 87,775 per 10 grams, while silver prices slipped by Rs 95, or 0.09 per cent, to end at Rs 1,00,450 per kg.

Rising inflation concerns, fuelled by US president Donald Trump’s ongoing trade battles, have driven gold to multiple record highs this year.

Gold is widely viewed as a hedge against both inflation and political uncertainties, making it a preferred asset during turbulent times.

In a sharp escalation, the European Union recently retaliated against the US’ blanket tariffs on steel and aluminium by slapping a 50 per cent tax on American whiskey exports. President Trump responded with a threat to impose a 200 per cent tariff on imports of European wines and spirits.

Investors are now closely monitoring the upcoming US Federal Reserve monetary policy meeting scheduled for next Wednesday, 19 March.

The central bank is expected to maintain its benchmark overnight interest rate in the range of 4.25–4.50 per cent. Gold, a non-yielding asset, typically benefits from a low-interest rate environment, making the Fed’s decision crucial for market sentiment.