Gold prices surged more than 1% to their highest level in more than two weeks on Friday (July 11), as investors turned to safe-haven assets after U.S. President Donald Trump escalated the global trade war with the announcement of new tariffs.

Spot gold rose 1.2% to $3,363.46 an ounce at 11:32 a.m. EDT (15:32 GMT), its highest level since June 24. U.S. gold futures rose 1.6% to $3,377.80. Global stocks weakened after Trump escalated his tariff attack on Canada, saying the U.S. would impose a 35% tariff on imports next month and plans to impose across-the-board tariffs of 15% or 20% on most other trading partners.

This week, Trump also announced a 50% tariff on U.S. copper imports and similar levies on goods from Brazil. "We're in an environment where the uncertainty premium is back in the market and gold is getting a safe haven bid," said Aakash Doshi, global head of gold strategy at State Street Global Advisors.

"I think the price range in the third quarter is likely to be between $3,100 and $3,500. The first half of the year was very strong, and I believe we're now in a deeper consolidation phase."

Non-yielding gold tends to perform well during times of economic uncertainty and low interest rate environments.

Federal Reserve Chairman Christopher Waller on Thursday reiterated his belief that the US central bank could cut interest rates at its policy meeting later this month. Investors are currently anticipating a 50 basis point rate cut by the Fed by the end of the year. Elsewhere, spot silver rose 3.4% to $38.30 per ounce, its highest level since September 2011. Platinum rose 0.8% to $1,371.43, and palladium gained 5.4% to $1,203.01.

US futures prices for silver, platinum, and palladium rose in premiums to the London benchmark after Trump's copper tariff announcement this week, which led to a surge in rental rates.

"Traders are unwinding open positions on the NYMEX/COMEX and are forced to borrow on the other side," said a precious metals trader, adding that activity in the so-called white metal has not affected gold. (alg)

Source: Reuters