BENGALURU- Gold prices edged down on Tuesday as market participants exercised caution and braced for US President Donald Trump’s tariffs on Canada, Mexico, and China to go into effect within hours.
Spot gold edged down 0.3 percent to $2,885.40 an ounce. US gold futures eased 0.2 percent to $2,895.40.
“This pull back is part of a broader shake-out in markets that could drive prices into the $2,700s before the primary uptrend continues,” Capital.com’s financial market analyst Kyle Rodda said.
It’s a modest move down so far on Tuesday, Rodda said, adding that the clear deterioration in global trade relations and the weaker dollar on fears of a sudden slow down in US growth had given the market a solid boost overnight.
Trump said on Monday that 25 percent tariffs on goods from Mexico and Canada will take effect from 0501 GMT on Tuesday, along with a doubling of China levies to 20 percent, stoking fears of a trade war in North America and sending financial markets reeling.
Trump also said reciprocal tariffs would take effect on April 2 on countries that impose duties on US products.
Trump’s tariff plans are widely seen as inflationary, and has prompted increased safe-haven flow into bullion, which has gained around 10 percent so far for the year.
