Gold Tests 'n Holds $3000 as Trump's 'Liberation Day!' Tariffs Whack Stocks
Friday, 3/21/2025 16:02
GOLD BULLION dropped on Friday afternoon in London, cutting this week's Dollar-price gains to 1.2% and briefly dipping through $3000 per ounce as global stock markets also fell hard amid growing economic concerns over President Trump's "liberation day for America" on 2nd April, when he plans to impose a raft of trade tariffs on foreign imports.
Gold in China, the precious metal's No.1 consumer market – and also the world's No.1 trade surplus nation – had earlier failed to make a new all-time high for the 1st time in 6 sessions, fixing 0.5% below
Thursday's fresh record Shanghai gold price of ¥709 per gram.
London bullion then held flat around $3030, before dropping 1.0% and ticking beneath
$3000 – a new all-time gold high when first reached on Friday last week – as New York opened for business with a plunge in the CME derivatives exchange's Comex gold futures contracts.
Comex gold futures saw their heaviest volume in more than 3 weeks, with almost 33,000 April contracts changing hands in 1 hour.
Hourly volume that large or larger has, so far in 2025, coincided only with sharp price falls, first
on Valentine's Day and
then on 25th February. Both times, the US stock market was also falling.
"April 2nd is Liberation Day in America!!!" Trump tweeted today on the Truth Social platform he owns.
"For DECADES we have been ripped off and abused by every nation in the World, both friend and foe. Now it is finally time for the Good Ol’ USA to get some of that MONEY, and RESPECT, BACK. GOD BLESS AMERICA!!!"
The tech-heavy Nasdaq 100 index opened today 1.7% lower, falling towards last week's 6-month low before cutting that drop to 0.5%.
The broader S&P500 index of US corporations meantime headed for its 5th weekly drop in a row, the longest run of falling stock prices since the post-Covid inflation-led crash of spring 2022.
"With roughly two weeks until [those as yet-unspecified] reciprocal tariff rates take effect," says the latest weekly analysis from bullion-market analysts Metals Focus, "there is a risk of a further escalation of the trade wars between the US and its key trading partners, which will raise recession fears.
"With already weak sentiment, a further correction in global stock markets, for US equities in particular, cannot be ruled out. Against this backdrop, investment inflows into gold are likely to continue among institutional investors seeking portfolio diversifications in the coming weeks."
Giant gold-backed gold ETF the GLD grew another 0.1% on Thursday, needing the most bullion to back its shares in issue since July 2023.
The smaller (and cheaper) gold ETF from iShares, the IAU product, was unchanged in size yesterday, on track to show its first weekly outflow in 8 weeks – albeit of less than 0.1%.
Despite the threat of trade tariffs hitting US imports of gold bullion, the
price gap between London spot and the most-active New York Comex futures contract held sharply below its recent spikes, shrinking to $6 per ounce compared with February's peak at $50.
One-month lease rates for London gold also retreated again, down to the lowest since the start of January beneath 0.3% per annum, while the lease rate for 1-month silver fell sharply to a 2-week low just shy of 4.0%.
Silver prices today tracked and extended the pullback in gold, fixing at midday in London with a 2.0% drop from last Friday's benchmarking auction before losing as much as 50 cents more to touch $32.67 per Troy ounce.
That was the more industrially-useful precious metals lowest price in 7 sessions.
Platinum and
palladium prices also dropped for the week, trading in the middle of their 2025 price ranges to date at $980 and $958 respectively.
Copper in contrast rose for the 3rd week running, rising 3.3% from last Friday – and driven by market fears of US trade tariffs on the base metal – after
breaching $10,000 per tonne on London's LME exchange for the first time in 5 months yesterday and testing
May 2024's all-time copper highs on the CME's US contracts.
"If we can continue to make progress on inflation over the long run," said Chicago Fed President Austan Goolsbee today – a voting member of the Federal Reserve committee which chose to leave US interest rates unchanged this week – "I believe that rates 12 to 18 months from now will be lower than where they are today."
"The current modestly restrictive stance of monetary policy is entirely appropriate," agreed New York Fed President John Williams in separate remarks, also noting "certain uncertainty" for policymakers right now.
With the Dollar this week rallying slightly from mid-March's new 5-month lows, the price of gold in Euros and UK Pounds both rose and then fell less steeply than for US investors, taking the weekly change to 1.7% and 1.2% respectively at €2785 and £2330 per Troy ounce.
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