Gold prices rose on Thursday as U.S. auto tariffs escalated global trade tensions ahead of an April 2 deadline for reciprocal tariffs from the world's largest economies.

Spot gold rose 0.4% to $3,030.47 an ounce by 0247 GMT. U.S. gold futures rose 0.5% to $3,036.00.

U.S. President Donald Trump on Wednesday announced a 25% tariff on imported cars and light trucks starting next week, widening a global trade war.

Investors are concerned that Trump's retaliatory tariffs, expected to take effect on April 2, could stoke inflation, slow economic growth and escalate trade tensions. Concerns over Trump's tariff policies sent gold prices to a record high of $3,057.21 on March 20. Aakash Doshi, global head of gold at SPDR ETF Strategy, expects gold to break through $3,100 in the second quarter and "the market could potentially see another 8%-10% upside by end-2025 if the current macro and physical market conditions support the yellow metal."

Goldman Sachs on Wednesday raised its year-end 2025 gold forecast to $3,300 an ounce from $3,100, citing stronger-than-expected ETF inflows and continued central bank demand.

Investors are awaiting U.S. personal consumption expenditures data, due on Friday, which could provide more insight into the path of U.S. interest rates.

The U.S. central bank held interest rates steady last week but indicated it could cut rates later this year. Non-yielding bullion tends to thrive in a low-interest environment.

Minneapolis Federal Reserve Bank President Neel Kashkari said that while the U.S. central bank has made significant progress in lowering inflation, "we still have a long way to go" to achieve the Fed's 2% inflation target.

Spot silver fell 0.1% to $33.69 an ounce, platinum rose 0.1% to $975.25, and palladium fell 0.4% to $964.56. (Newsmaker23)

Source: Reuters