Amid escalating tensions in US-Europe trade relations, risk aversion sentiment surged significantly, prompting a flow of funds back into precious metals like gold and silver. After touching an intraday high of $4,698 in early trading, gold prices retreated slightly. By the close, COMEX gold futures had risen 1.77% to settle at $4,676.7 per ounce. The ChinaAMC Gold ETF (518850) gained 1.58%, the Gold Stock ETF (159562) climbed 2.29%, and the Nonferrous Metals ETF Fund (516650) advanced 0.38%.
An economist warned that the UK faces a risk of economic recession if US President Trump swiftly advances new tariff threats. According to a World Bank assessment of UK economic growth, the British economy could suffer a loss of £21.6 billion if Trump raises tariffs to 25% starting in June. Capital Economics estimates suggest UK GDP would decline by 0.3% to 0.75%.
Paul Dales, Chief UK Economist at Capital Economics, stated that with the UK economy currently growing by only 0.2% to 0.3% per quarter, a one-time shock could potentially trigger a recession.
Related analysis points out that during President Trump's term, US tariff policies have been highly frequent and volatile, encompassing various aspects, including trade relations concerning minerals and metals with geopolitically sensitive regions. Although 2025 already exhibited a trend of intensifying tensions and strategic games, these relationships are expected to remain volatile in 2026, warranting continuous attention. Recently, Wall Street institutions have frequently raised their gold price targets, with Bank of America and J.P. Morgan suggesting that prices could ultimately reach $6,000.
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