Safe-haven gold edges up as a US tariff threat nears its deadline

Bengaluru — Gold edged up on Wednesday as investors sought safety from the threat of new US tariffs on Chinese goods coming into effect on December 15, while also awaiting policy decisions from major central banks.

Automotive catalyst metal palladium held just shy of a record high. Spot gold had gained 0.2% to $1,467.31 an ounce by 10.48am GMT. US gold futures rose 0.3% to $1,471.90.

“The trade war continues to be a factor supporting gold, there’s no easy solution to it and that uncertainty will keep gold prices up,” said Commerzbank analyst Eugen Weinberg. US President Donald Trump has days to decide whether to impose tariffs on nearly $160bn worth of Chinese goods, scheduled to take effect on Sunday.

The White House’s top economic and trade advisers are expected to meet with Trump in the coming days to discuss the issue, one person briefed on the situation told Reuters. Washington is laying the groundwork for a delay in the latest tariffs, but a final decision has not been made, the person said.

“Should both [US and China] fail to reach positive consensus, gold prices will receive strength over lacklustre risk appetites for the near term,” Phillip Futures analyst Benjamin Lu said in a note.

Gold is considered a safe investment during political and economic uncertainty.

The US Federal Reserve will issue a statement on its December policy meeting later on Wednesday. Although the Fed is expected to leave interest rates unchanged, investors are eager to hear its outlook for the economy, which has been affected by the tariff war.

“As far as the central banks are concerned, it is not only the Fed that investors are looking at, but all the major central banks,” Commerzbank’s Weinberg said. The European Central Bank (ECB) will hold its first meeting and news conference with Christine Lagarde as president on Thursday.

On the technical front, signals are mixed for spot gold, as it kept bouncing towards a resistance at $1,466 an ounce, according to Reuters technical analyst Wang Tao.

In other metals, palladium gained 0.1% to $1,898.15 an ounce, having surged past the key level of $1,900 for the first time on Tuesday. Speculative buying and a mine closure in major producer SA have supported palladium prices, which are expected to rise further in the longer term, a trader from Japan-based retailer Tokuriki Honten said.

Silver rose 0.1% to $16.67, while platinum edged down 0.2% to $920.19. 

Reuters