Gold Prices Surge Amid Tariff Concerns
Recently imposed tariffs by US President Donald Trump on the European Union and Mexico, set at 30%, are causing gold prices to rise. On Monday, gold reached a three-week high as investors flocked to it—typically viewed as a safe haven during uncertain times. As of 10:20 PM Monday, Spot Gold was up by 0.21%, trading at $3,350.69 per ounce. Year-to-date, gold prices have increased about 28%, fueled by geopolitical uncertainties and concerns surrounding Trump’s tariffs. In contrast, the S&P 500 index rose only 6.58%, while the yield on 10-year U.S. Treasury bonds dropped below 13.4 basis points.
Gold seems to be outpacing traditional safe haven assets, like the S&P 500 and U.S. Treasuries, which haven’t been as stable due to their volatility. Chee Keongkoh, who leads forex strategy at wealth management firm Wrise, believes gold could stabilize between $3,100 and $3,500 for the remainder of 2025. A recent survey by the World Gold Council indicated that 95% of participants foresee an increase in global central bank gold reserves within a year. Additionally, 73% expect a significant reduction in U.S. dollar reserves over the next five years.
Stefan Hofer, chief investment strategist at LGT Private Banking Asia, anticipates further hikes in gold prices, mainly due to potential interest rate cuts from the U.S. Federal Reserve. He speculates gold might reach $3,650 per ounce in the next year, a nearly 9% increase from current levels. “Expectations for inflation are rising, and people are likely going to seek gold,” he noted on CNBC’s Squawk Box Asia. While he dismissed extreme predictions of gold reaching over $5,000 an ounce, he stands by an expected 10% rise over the next year.
KOH from Wrise recommends investors eyeing gold should consider buying it closer to the $3,100 mark, seeing it as part of a wider portfolio diversification strategy. Among KOH’s top picks are Barrick Gold and Newmont Corporation, which he believes have strong revenue growth and solid positioning in the gold market. He also points out opportunities in Vaneck Gold Miners ETF and Vaneck Junior Gold Miners ETF, both of which have seen impressive returns this year.
For those interested in a more tangible investment, Hamilton Capital’s Munoz suggests physical gold as a solid option. He emphasizes the importance of owning the actual product, given the risks of market fluctuations. Clients he advises are predominantly wealthy individuals and families, and he suggests that physical gold can be a more cost-effective choice compared to ETFs, which typically charge annual fees. Nonetheless, he warns potential buyers to factor in storage costs when considering physical gold.
Gold has long been hailed as a classic safe haven asset, but Wilmac Donaw, CEO of Merchant Bank Corestone Capital, suggests it might be losing that edge. He posits that other asset classes—such as copper and Bitcoin, which recently surpassed the $120,000 mark—are emerging as competitors. “Gold has significantly fewer real-world applications than copper, and Bitcoin is stealing some of gold’s spotlight,” Donaw explained. Despite this, investors still recognize gold’s worth through both physical assets and futures.
