Gold Dips 0.3% but Remains on Track for Weekly Rise

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Despite Minor Pullback, Gold Holds Near Recent Highs as Investors Weigh Tariff News

Gold prices experienced a slight decline on Friday, yet remained poised for a weekly gain, as market uncertainties surrounding U.S. trade policies, particularly President Trump’s tariff plans, bolstered demand for the precious metal. Traders also awaited the release of U.S. non-farm payrolls data later in the day for further market cues.

Spot gold saw a 0.3% decrease, trading at $2,900.48 per ounce as of 00:17 GMT. However, the metal was on track to record a 1.6% weekly increase. U.S. gold futures also dipped, falling 0.6% to $2,908.70.

The fluctuations in gold’s price are attributed to various factors, notably Trump’s recent announcement regarding the suspension of 25% tariffs on most goods from Canada and Mexico, which had been implemented earlier in the week. This policy shift represents the latest development in a series of evolving trade measures that have introduced volatility to financial markets and heightened concerns about potential inflation and economic deceleration.

Concurrently, U.S. initial jobless claims showed a greater-than-anticipated decrease, indicating a relatively stable labor market in February. However, the market remains wary of potential disruptions stemming from import tariffs and significant reductions in government spending.

Federal Reserve Governor Christopher Waller expressed a strong inclination against an interest rate reduction during the Fed’s upcoming policy meeting this month. Nevertheless, he suggested that rate cuts later in the year could still be feasible if inflationary pressures continue to subside.

“The possibility of more Fed rate cuts than currently priced in, due to weaker economic data, is injecting additional uncertainty into the markets,” stated Fawad Razaqzada, market analyst at City Index and FOREX.com. “Despite these conflicting signals, gold has maintained its position near recent highs and remains on a trajectory to potentially achieve $3,000 in the near term.”

Gold is often regarded as a safe-haven asset during times of political uncertainty and inflationary pressures. However, prolonged periods of elevated interest rates can diminish the appeal of gold, as it does not offer a yield.

Market attention is now focused on the non-farm payrolls report, scheduled for release at 1330 GMT. A Reuters survey anticipates the report to reveal a gain of 160,000 jobs for February.