Gold blazed past the $3,200 mark on Friday, as a faltering dollar and an escalating US-China trade war stirred recession fears, sending investors flocking to the safety of the yellow metal.
Spot gold was up nearly 2 percent at $3,235.89 an ounce, after hitting a record high of $3,245.28 earlier in the session. Bullion is up over 6 percent this week.
US gold futures rose 2.1 percent to settle at $3244.6.
“Gold is clearly seen as the favoured safe-haven asset in a world upended by Trump’s trade war. The US dollar has depreciated, and US Treasuries are selling off hard, as faith in the US as a reliable trading partner has diminished,” said Nitesh Shah, commodities strategist at WisdomTree.
China increased its tariffs on US imports to 125 percent on Friday, raising the stakes in a confrontation between the world’s two largest economies.
The dollar fell against its peers, making greenback-priced bullion cheaper for overseas buyers.
A combination of central bank buying, US Federal Reserve rate cut expectations, geopolitical instabilities and a surge of investor flows into gold-backed ETFs has also supported gold’s rally this year.
US monthly producer prices unexpectedly fell 0.4 percent in March, but tariffs on imports are expected to drive inflation higher in the coming months.
