Gold traded at a fresh record high early on Friday as the dollar continued to plunge amid an escalating tariff between the United States and China, while another U.S. inflation measure weakened last month.
Gold for June delivery was last seen up US$69.30 to US$3,246.80 per ounce, rising off Thursday's record close of US$3,177.50.
The rise comes as investors seek a safe haven with China and the United States continuing a tariff battle. China on Friday hiked its tariff on U.S. imports to 125%, a day after U.S. President Donald Trump raised levies on Chinese goods to 145%. The heightened tensions between the two follow on Trump's Wednesday decision to pause levies on most U.S. trading partners that briefly rallied stocks. But markets retreated on Thursday amid worries over the impact of trade battles on global growth.
"After losing quite a bit of ground in a largely unintuitive move where gold got caught up in the cross-asset sell-off and shouldered the burden of covering losses elsewhere, it has since regained its sea legs. The stemming of the market rout and the 90-day partial pause on tariffs left gold no longer bearing the burden of extreme market drops (for now at least), and instead it is left to trade more on the macro merits of the moment and, perhaps most importantly, broader market uncertainty," Christopher Louney, a commodities strategist at RBC Capital Markets, wrote.
Another U.S. inflation measure weakened last month. Following on an unexpected drop in March consumer prices reported on Thursday, U.S. wholesale prices also deflated last month, with the Bureau of Labor Statistics saying its Producer Price Index fell 0.4% from February, down from a rise of 0.1% in the prior month and under the FactSet consensus estimate for a rise of 0.2%.
Core PPI, excluding food and energy, rose at a 3.3% annual clip, down from 3.5% in February and under expectations for a 3.6% rise.
The dollar was sharply lower on the U.S. trade wars and easing inflation. The ICE dollar index was last seen down 1.4 points to 99.48, the lowest since the winter of 2022.
Treasury yields were mixed, with the U.S. two-year note last seen paying 3.864%, down 1.9 basis points, while the yield on the 10-year note was up 0.4 points to 4.44%.
Source: MT Newswires
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