Gold Prices Surge Above USD2,900 per Ounce, Supported by Weaker Dollar

Chicago – Global gold prices climbed back above USD2,900 per ounce on Monday (Tuesday WIB), driven by a weaker US dollar and growing concerns over a potential trade war, following US President Donald Trump’s threat of retaliatory tariffs.

According to Yahoo Finance data on Tuesday, February 18, 2025, spot gold rose 0.5% to USD2,897.49, retreating slightly from its intraday high of USD2,906.38. Last week, gold had reached a record USD2,942.70. Meanwhile, US gold futures increased by 0.3% to USD2,910.30.

The US dollar remained near a two-month low, making gold more affordable for buyers holding other currencies. Gold prices are projected to reach USD3,000, supported by ongoing demand from central banks.

On Friday, Trump reaffirmed his stance on trade policy, stating that tariffs on automobile imports would take effect on April 2, 2025. This move is the latest in a series of aggressive trade measures since he resumed office for a second term.

Additionally, Ukraine peace talks have become a focal point for the market. US Secretary of State Marco Rubio mentioned that Kyiv and European nations would be part of the negotiations aimed at ending the Russia-Ukraine conflict.

Gold as a Hedge Against Inflation and Geopolitical Uncertainty

Gold has long been considered a traditional hedge against inflation and geopolitical risks. However, higher interest rates could reduce its appeal as gold does not generate yield.

Several Federal Reserve officials are scheduled to speak later this week, and market participants will be closely watching for clues on the direction of US interest rates.

Meanwhile, US markets remained closed in observance of Washington’s Birthday or President’s Day.

Among other precious metals, spot silver gained 0.8% to USD32.40 per ounce, after hitting its highest level since October 31 on Friday. Platinum slipped 0.1% to USD979.07, while palladium advanced 1.4% to USD974.99.

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