BENGALURU- Gold erased earlier losses and held steady on Wednesday, helped by a weakening US dollar and safe-haven demand as markets continued to track possible impacts of US President Donald Trump’s fresh tariffs.
Spot gold was little changed at $2,915.48 an ounce after rising nearly 1 percent on Tuesday, while US gold futures rose 0.2 percent to $2,926.20.
The dollar index was at a three-month low, making bullion less expensive for overseas buyers. The benchmark 10-year Treasury yields however, gained, diminishing non-yielding gold’s appeal.
“I expect gold will likely remain an in-demand asset whilst international trade uncertainties remain the prevailing market theme,” said Tim Waterer, chief market analyst at KCM Trade.
Trump’s fresh 25 percent tariffs on Mexican and Canadian imports took effect on Tuesday, along with a doubling of duties on Chinese goods to 20 percent, spurring trade wars that could slam economic growth and lift prices for Americans still smarting from years of high inflation.
China and Canada retaliated with their own set of tariffs on a range of US goods, with Mexico expected to respond on Sunday.
Federal Reserve Bank of New York President John Williams said that the US tariffs will likely drive inflation higher, while adding that the current interest rate policy is appropriate and does not need changes.
