Gold prices continued their rally for the third straight day on Friday (11/4) with the yellow metal hitting a new all-time high of $3,245. The gain of over 2% was recorded amid the escalating trade war between the US and China and its impact on the global economy. At the time of writing, XAU/USD was trading at $3,233.

During the North American session, China imposed 125% tariffs on the US in retaliation for US President Donald Trump's decision to raise its import duties to 145% on Chinese products. Hence, investors seeking safety pushed the Bullion prices higher, driven by a weaker Greenback, which fell to a near three-year low, as depicted by the US Dollar Index (DXY) reaching 99.01.

The economic document featured several Federal Reserve (Fed) officials delivering news. Inflation on the producer side eased slightly for both the headline and core readings, although the latter remained at the 3% threshold. Following that, the University of Michigan Consumer Sentiment poll revealed that American households have become pessimistic about the economic situation and are increasingly concerned about inflation expectations.

While the data is mixed, this could discourage the Fed from easing policy due to trade tariffs, which are considered inflation-prone. Therefore, as the Fed is likely to remain in wait-and-see mode, traders are now fully pricing in three rate cuts by 2025. (Newsmaker23)

Source: FXstreet