Gold prices saw a modest rise on Monday, recovering slightly after a more than 1% drop in the previous session. Market participants are closely awaiting further details on U.S. President Donald Trump's reciprocal tariff plans, which could escalate global trade tensions.
Key Details:
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Spot gold increased by 0.1% to 2,942.70 on February 11.
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U.S. gold futures, however, dipped 0.1% to $2,897.10.
Trade Tensions and Economic Indicators:
President Trump reiterated his tariff threats on Friday, announcing that levies on automobiles could be imposed as early as April 2. This follows reports from his cabinet members, due by April 1, outlining options for a range of import duties as part of his broader strategy to reshape global trade.
Meanwhile, U.S. retail sales data released on Friday showed a significant drop in January, marking the largest decline in nearly two years. This points to a sharp slowdown in economic growth at the start of the first quarter.
Federal Reserve Outlook:
Despite the economic slowdown, traders anticipate that the Federal Reserve will hold off on cutting interest rates until the second half of the year, citing concerns over high inflation.
Geopolitical Developments:
U.S. Secretary of State Marco Rubio stated on Sunday that Ukraine and Europe would be integral to any "real negotiations" aimed at ending Moscow's war. His comments suggest that upcoming U.S.-Russia talks this week will serve as a gauge of Russian President Vladimir Putin's commitment to peace.
Other Precious Metals:
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Spot silver fell 0.2% to $32.08 an ounce after reaching its highest level since October 31, 2024, on Friday. Analysts suggest that silver investors may be eyeing a challenge to a 10-year high, driven by factors similar to those pushing gold to record levels.
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Platinum rose 0.3% to 974.08.
Market participants remain focused on trade developments, economic data, and geopolitical dynamics as they assess the outlook for precious metals.