Gold prices surge to record as Trump imposes tariffs on steel & aluminum imports

According to Reuters, gold prices have soared to unprecedented heights, reaching a record $2,911.30 per troy ounce on Monday, which marked its seventh peak in 2025. The precious metal's remarkable ascent, showing an 11% increase this year following a stunning 27% gain in 2024, has been primarily fueled by Donald Trump's latest tariff announcements. Market analysts from Reuters suggest that the $3,000 milestone is now within reach, with independent analyst Ross Norman describing the market as "incredibly strong, almost relentless."

The surge in gold prices has triggered a significant shift in the global bullion market. Reuters adds that banks are rushing to borrow gold from central banks in London, while simultaneously transporting bullion from Asian trading hubs to the United States. COMEX-approved warehouses now hold 34.60 million ounces, representing a more than 90% increase since late November. This surge in gold holdings coincides with robust central bank demand, which exceeded 1,000 tons for the third consecutive year in 2024. 

In January, China's central bank continued its gold-buying trend, increasing reserves for the third consecutive month, reported The Business Times. Additionally, new policies have been introduced that permit insurance funds to invest in gold.

The dramatic rise in gold prices comes amid Trump's announcement of new steel and aluminum tariffs, says BBC, which provides comprehensive coverage of international trade policies and their global impact. According to BBC's analysis, this move represents a significant escalation in Trump's trade policies, which have already prompted retaliation from China. The implications of these tariffs extend beyond North America; the BBC reports that the European Union has stated there is "no justification" for such measures on its exports, while South Korean steel and car maker shares have declined following the announcement. 

Trade experts interviewed by the BBC warn that these tariffs could lead to increased costs for US manufacturers, particularly affecting car companies and beverage producers who rely heavily on these metals. Additionally, the UK steel industry, which depends significantly on US exports for specialty products, could face a "devastating blow," according to trade body UK Steel's statement to the BBC.

The news release from The White House indicates that the suggested 25% import tax on all steel and aluminum entering the US has caused significant disruptions in global markets, especially impacting Canada, a major trading partner for these metals.

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