REUTERS: Gold prices surged to a record high on Wednesday, April 16, 2025, driven by a confluence of factors including a weakening dollar, escalating trade tensions, and growing concerns about global economic growth. These conditions fueled demand for gold as a safe-haven asset.
Gold Price Reaches New Heights
- Spot gold climbed 1.9% to $3,287.79 an ounce.
- Earlier in the session, it touched an all-time high of $3,294.99 per ounce.
- U.S. gold futures increased by nearly 2% to $3,304.20.
Factors Driving the Surge
Several key factors contributed to gold's record-breaking performance:
- Dollar Depreciation: The dollar index eased 0.7% against its rivals, making gold more appealing to holders of other currencies.
- Trade Tensions: Escalating trade tensions between the U.S. and China further fueled risk aversion.
- Nvidia's Export Challenges: Nvidia reported it would take a $5.5 billion charge due to U.S. government restrictions on exporting its H20 artificial intelligence chip to China.
- Boeing Jet Deliveries Halted: China reportedly ordered its airlines to halt further deliveries of Boeing jets in response to U.S. tariffs on Chinese goods.
Analyst Insights
The dollar index (.DXY), opens new tab eased 0.7% against its rivals, making gold more attractive for other currency holders.
Further escalating the U.S.-China trade tensions, Nvidia (NVDA.O), opens new tab said on Tuesday it would take $5.5 billion in charges after the U.S. government limited exports of its H20 artificial intelligence chip to China.
China ordered its airlines not to take any further deliveries of Boeing (BA.N), opens new tab jets in response to the U.S. imposing 145% tariffs on Chinese goods.
"More tariff uncertainty, more intransigence from the U.S. administration, tariff impacting goods moving through third-party countries with likely damage to global supply chains," is supporting gold, said Nicholas Frappell, global head of institutional markets, ABC Refinery.
Market analysts weighed in on the factors influencing gold prices:
- Tim Waterer, KCM Trade chief market analyst, noted that dollar depreciation and ongoing risk aversion were working in gold's favor.
- Nicholas Frappell, global head of institutional markets at ABC Refinery, stated that tariff uncertainty and intransigence from the U.S. administration were supporting gold prices.
- Brian Lan, Managing Director at GoldSilver Central, emphasized that gold would remain strong as long as uncertainty persists.
ANZ's Bullish Forecast
ANZ raised its year-end gold price forecast to $3,600 per ounce and its six-month forecast to $3,500, citing the expectation that risk-off purchases for gold are yet to peak.
Other Precious Metals
The performance of other precious metals was mixed:
- Spot silver rose 0.8% to $32.56 an ounce.
- Platinum decreased 0.5% to $954.90.
- Palladium fell 0.6% to $965.96.
Looking Ahead
Investors are now awaiting U.S. retail sales data for further economic insights and indications of the Federal Reserve's policy direction.