Gold pulls back from record high

15 Nisan 2025

Gold Pulls Back from Record High, Holds Steady as Markets Await New Catalysts

Written by Linh Tran, Market Analyst at XS.com

Gold has temporarily pulled back from its record high of $3,245/oz set last week, following a strong rally driven by a combination of U.S.–China trade tensions and signs of easing inflation.
In yesterday’s session, gold continued to trade at elevated levels, reflecting a cautious market sentiment as investors await fresh catalysts. However, the broader uptrend in gold remains intact, supported by growing expectations that the Federal Reserve will soon begin a monetary easing cycle, especially after last week’s CPI and PPI data both came in below expectations.

In addition, the escalating trade war between the U.S. and China is another key factor supporting gold prices. President Donald Trump has officially imposed tariffs of up to 145% on Chinese goods, while China responded immediately with retaliatory tariffs of 125% on U.S. products, declaring it is ready to “fight to the end.”

However, Trump’s trade policy stance has shown signs of inconsistency, making market predictions more difficult. Earlier this week, he unexpectedly announced exemptions for smartphones and certain electronic devices from the high-tariff list, which fueled a rally on Wall Street. He also hinted at the possibility of granting tariff exemptions for automobiles, raising hopes that negotiations could resume in some sectors.

Nonetheless, this inconsistency in Trump’s policy direction is generating significant uncertainty over U.S. economic strategy, leading to a sharp decline in global risk appetite. In such a context, gold continues to be favored as a safe-haven asset.

Meanwhile, the situation between Russia and Ukraine has shown no notable progress toward peace negotiations, despite efforts from some mediators calling for renewed dialogue. So far, there are no encouraging signs of a long-term ceasefire between the two nations. This ongoing uncertainty continues to elevate geopolitical risks worldwide, further reinforcing investor demand for gold as a protective asset.

With three core drivers — monetary easing expectations, U.S.–China trade tensions, and elevated geopolitical risks — gold is currently supported by a strong foundation to sustain its long-term bullish trend that began earlier this year. In an environment filled with uncertainties, gold’s safe-haven appeal remains highly relevant.

However, any conflicting signals from one or more of these drivers could quickly shift the direction of the gold market in the short term.

This week, the spotlight will be on a speech by Fed Chair Jerome Powell, as investors look for clues on the central bank’s policy stance. Additionally, the U.S. Core Retail Sales data will offer further insights into consumer health and inflationary pressure. Both of these factors could impact interest rate expectations — and, by extension, the short-term trajectory of gold prices.

 

Zaid Barem / ymm