A Weak Dollar and Demand for Safe Havens Keep Gold Prices Stable at their Three-Month High.

The U.S. dollar was under pressure to decline after President Donald Trump delayed imposing tariffs at the start of his second term, which kept gold prices mostly quiet Thursday but close to three-month highs.

Meanwhile, gold futures expiring in February fell 0.3% to $2,763.39 an ounce, while spot gold remained mostly stable at $2,755.14, close to its best level since late October.

This week, the yellow metal experienced three days in a row of increases as markets attempted to assess Trump’s objectives and safe-haven demand increased. Gold is viewed as an inflation hedge, and it is anticipated that his actions will increase inflation.
Gold prices were also supported by the dollar’s steep decline on Monday and its continued relative weakness this week as Trump has shied away from details on the enforcement of U.S. trade tariffs.

Trump pledged to impose tariffs on the European Union on Tuesday and stated that he was thinking of putting 10% tariffs on Chinese imports starting on February 1. This demonstrated that a gradual implementation of tariffs was anticipated.

The additional tariffs will probably lead to lower trade deficits and higher U.S. inflation, both of which are dollar-positive.

Thursday’s Asian trading saw a minor decline in the US Dollar Index.

Because gold becomes more expensive for buyers using other currencies, a stronger dollar usually results in lower gold prices.

The spike in bullion prices also indicates that markets are preparing for higher volatility as a result of Trump’s anticipated policy and tariff pronouncements.

On Thursday, other precious metals declined. Silver Futures were down 0.6% to $31.218 an ounce, while Platinum Futures fell 0.7% to $964.30 an ounce.