Gold Prices: New Record High for Bullion on 3 Catalysts

It’s a glittering year for gold.

The precious metal broke through another record high on Friday, briefly rising to $3,534 before paring its gains. At its peak, gold prices were up 32% from levels at the start of the year — far outstripping the S&P 500’s 8% year-to-date gain.

Analysts on Wall Street are pointing to three catalysts that drove the latest leg up:

1. Trump’s tariffs

The US specified that gold bars are subject to tariffs, the Financial Times reported on Thursday, citing documents it reviewed from the Customs and Border Protection agency.

A ruling letter dated July 31 from the agency said that one-kilo and 100-ounce gold bars would be grouped under a customs code that would subject to levies, the outlet said. That means gold bars could be subject to the 39% tariff on goods from Switzerland, which is one of the world’s largest producer of gold bars.

“The White House intends to issue an executive order in the near future clarifying misinformation about the tariffing of gold bars and other specialty products,” a White House official told Business Insider in an email.

Markets had previously assumed gold bars would be exempt from reciprocal tariffs, Helen Amos, a commodities analyst at BMO, wrote in a note on Friday. Trump’s original Liberation Day announcement included a separate customs code that said “non-monetary gold, unwrought, in the form of bullion and dore” would be exempt from import duties, she noted.

“If true, US citizens who tried to hedge the inflation impact of US President Trump’s trade taxes by buying gold bars must pay those same taxes on their hedge. The ruling suggests gold imported between 9 April and 7 August was subject to tariff,” Paul Donovan, the chief economist at UBS, wrote in a note.

2. Geopolitical tensions

Tensions between the US, Russia, and China are fueling gold’s rally, according to Samer Hasn, a senior market analyst at XS.com.

Hasn pointed to Trump’s attempts to broker a peace deal between Russia and Ukraine, which has involved imposing steep tariffs on some of Russia’s top trading partners, like India, and threatening to impose secondary sanctions on Russia if a ceasefire isn’t achieved by Friday.

China, another of Russia’s top trading partners, has also yet to reach a trade deal with the US, despite the looming August 12 deadline before higher tariffs take effect.

“As a result, the coming hours and days may play a key role in shaping market dynamics. Should negotiations with China and India falter, and no ceasefire in Ukraine materialize, geopolitical tensions could escalate beyond tariff threats alone. Such an outcome could renew the risk premium on safe-haven assets and most notably gold,” Hasn wrote in a note.

3. Concerns about the US economy

To top it off, investors have been fretting over the strength of the US economy, which has been flashing key signs of weakness despite robust GDP growth over the second quarter.

Most recently, cracks have been appearing in the job market, with the US adding fewer jobs than expected in July. Job growth over the months of May and June, meanwhile, saw a large downward revision, signaling that hiring has been weaker than markets originally thought.

That, combined with several inflation metrics ticking higher, has stoked fear among some investors that the US could be headed toward stagflation, a scenario where inflation remains hot and growth slows. That situation is thought to be even worse for policymakers to solve than a typical recession, as high prices prevent the central bank from cutting rates to give the economy a boost.

“Even conservative platforms are increasingly voicing concern about long-term consequences and the false sense of optimism some economic figures may convey. Lingering concerns among investors are likely to continue supporting gold as a long-term safe-haven asset and sustain its broader upward momentum,” Hasn said.

Wall Street forecasters are generally bullish on gold, as uncertainty stemming from Trump’s tariffs continues to loom over the US economy.

In April, Goldman Sachs lifted its year-end gold forecast to $3,700, implying 6% upside for the precious metal from current levels.

Ed Yardeni, a market veteran and the president of Yardeni Research, said he believed gold could climb as high as $4,000 by the end of 2025, implying a 14% increase.