Gold prices rose to a three-week high on Monday (February 23), as uncertainty stemming from the US Supreme Court's ruling rejecting a large part of the tariffs imposed by President Donald Trump, put pressure on the USD and urged investors to turn to gold as a safe haven.
Spot gold prices rose 0.6% to $5,128.82/ounce in the trading session. US gold futures for April delivery rose 1.5%, to $5,157.50/ounce.
The court's ruling on tariffs, in addition to angering the US President, also creates a new layer of uncertainty for the global market, causing traders to once again return to gold as a defensive option," said Tim Waterer, Head of Market Analysis at KCM Trade.
The US Supreme Court has rejected the broad tariffs that Mr. Trump is pursuing based on a law designed for use in national security emergencies. The landmark ruling on Friday (February 20) is seen as a heavy failure for the Republican president, and has major implications for the global economy.
After this ruling, Mr. Trump said he would raise the temporary tariff from 10% to 15% on goods imported into the US from all countries.
Wall Street stock futures and the USD simultaneously fell in Asian trading on Monday, as ambiguities surrounding US tax policy revived the "US asset sell-off" wave.
In my opinion, the possibility of gold prices returning above the $5,400 mark in the short term will depend on how long the uncertainty about tariffs lasts, as well as whether the US will take military action against Iran or not," Mr. Waterer added.
Iran said it is ready to make some concessions related to its nuclear program in negotiations with the US, in exchange for lifting sanctions and recognizing the right to enrich uranium, in an effort to avoid the risk of being attacked by the US.
In another development, data released on Friday showed that US core inflation in December increased more strongly than forecast, and recent signals suggest that inflation may continue to accelerate in January. This reinforces expectations that the US Federal Reserve will not cut interest rates before June.
On other precious metals markets, spot silver prices rose 1.2% to 85.57 USD/ounce, the highest level in more than two weeks. Platinum prices fell slightly 0.3% to 2,149.22 USD/ounce, while palladium fell 0.4% to 1,740.25 USD/ounce.
