Due to a declining U.S. dollar and safe-haven flows brought on by growing fears about the U.S. economic prospects amid intensifying trade tensions, gold was up close to $2,900 per ounce on Tuesday.
After President Donald Trump stated in a Fox News interview on Sunday that the U.S. economy was in a “period of transition,” without ruling out the prospect that his policies might trigger a recession, worries about the possible economic slowdown were further heightened.
This comes after Canada maintained its first retaliatory actions while the United States postponed for a month the 25% tariffs on a number of Canadian and Mexican imports.
In reaction to Trump’s most recent tariff increases on Chinese commodities, China likewise placed higher taxes on a few U.S. agricultural exports.
Jerome Powell, the chair of the Fed, recognised growing economic uncertainties but did not say that interest rate cuts were urgent.
Investors are now anticipating this week’s U.S. inflation data, which may have an impact on the Fed’s monetary policy position.