Concerns over a potential U.S. recession and a global economic slowdown are driving a surge into gold, with the metal likely to climb even further, according to Vivek Dhar, an analyst at Commonwealth Bank of Australia. Following the announcement of President Trump’s U.S. reciprocal tariff plan, gold futures hit a new high above $3,150/oz.
“The prospect of a weaker U.S. economy from higher U.S. tariffs has boosted market expectations of [federal-funds] rate cuts by the end of the year,” notes Dhar, adding that markets are now pricing in 85–90 basis points of cuts by year-end, up from 75–80 basis points on Wednesday.
“Gold futures should continue to increase if further Fed funds rate cuts are priced in,” he says. Spot gold is up 0.5% at $3,152.88/oz.
