FX.co ★ Gold Falls from Record High

Gold experienced a significant decline of over 3%, dropping below $3,060 per ounce on Thursday after briefly reaching a record high exceeding $3,160. This fluctuation followed the news that the White House would exempt precious metals, steel, aluminum, and other metals from President Trump's proposed "reciprocal" tariffs. Despite this exemption, apprehensions regarding the potential impact of these tariffs on global inflation and economic growth persisted. Additionally, the expectation of interest rate cuts, continued central bank purchases, and robust demand for gold-backed ETFs helped cushion the losses.

On Wednesday, President Trump announced a baseline tariff of 10% on imports from all countries, with increased rates for primary trading partners: 34% for China, 20% for the European Union, and 24% for Japan. Furthermore, a 25% tariff on all foreign-manufactured vehicles was implemented today. Trump justified these tariffs by asserting that they would bolster domestic manufacturing and help reduce trade deficits.

Meanwhile, investors are closely monitoring the upcoming U.S. non-farm payrolls report, scheduled for release on Friday, which is anticipated to provide further guidance on the Federal Reserve's monetary policy direction.