GOLD PRICES fell hard Tuesday after setting the 8th new all-time high in 9 sessions, trading back below $2900 per Troy ounce in London's bullion market as No.1 consumer China showed weak demand, the 'arb' with New York's Comex futures market retreated again despite President Trump threatening more trade tariffs, and US Fed chairman Jerome Powell said he's "in no rush" to cut the cost of borrowing Dollars.

 

The price of gold bullion in London spiked as high as $2942 per Troy ounce in early Asian trade, but then sank by 2.0% down to $2882, before rallying towards the $2900 mark again.

 

 

Shanghai gold prices meantime set a fresh record at ¥690 per gram before falling to ¥684 and showing a discount against London quotes of more than $11 per ounce, deterring new bullion imports.

 

The gap between London quotes and New York's most-active CME gold futures contract then eased towards $20 per ounce, more than halving the arbitrage offered to new deliveries into the USA since it peaked at $50 ahead of President Trump's re-inauguration.

 

 

"Geopolitical uncertainty should continue to underpin gold’s appeal," says Swiss banking giant and London bullion clearer UBS.

 

"Notably, it could take time for investors to evaluate the trajectory of US tariffs [and] the US President’s offer to take over the Gaza Strip.

 

"Although the Fed is unlikely to cut rates in the coming months, we do still expect further easing later in the year as inflation falls and growth cools. This fall in US rates lowers the opportunity cost of holding zero-yielding assets such as gold...[and] gold’s appeal as a store of value and hedge against uncertainty has again proven itself to many investors."

 

Confirming 25% tariffs on all US imports of aluminum and steel staring in mid-March, President Trump also said overnight that he will impose "reciprocal" tariffs against nations applying tariffs to US products.

 

"It's not fair," said Trump. "Other countries have taken advantage of us for so many years, and now all of a sudden, we're not allowed to have tariffs?"

 

With the Dollar edging back on the FX market despite Powell and Trump's comments, the UK gold price meantime spiked to a new record £2381 per Troy ounce while Euro gold prices hit €2856 before also dropping back to halve this week's gain so far at 1.4%.

 

Silver also fell with gold, spiking down to a 1-week low of $31.26 per Troy ounce before similarly recovering the past 24 hours' action to trade back close to $32.