Gold hits over 2-month high as dollar and silver rates decrease

Gold prices surged to over a two-month high on Tuesday as the U.S. dollar weakened, with the precious metal also supported by buying amid uncertainty surrounding Donald Trump’s trade policies.

Spot gold climbed 0.4% to $2,719.52 per ounce by 1059 GMT, reaching its highest level since Nov. 6 and nearing the all-time high of $2,790.15 set in October.

The dollar slipped 0.6% versus major peers, holding close to a 2-week low hit in the previous session, making bullion more attractive for other currency holders.

U.S. gold futures were 0.6% lower at $2,732.60, narrowing the premium over spot rates, after U.S. President Trump did not immediately impose tariffs after his inauguration on Monday as expected.

However, Trump suggested the U.S. could impose tariffs on Canada and Mexico in the near future.

The market is likely to benefit from the uncertainty of “Trump swings”, and gold could reach $3,000 per ounce by mid-year, said Julia Khandoshko, CEO at broker Mind Money.

Bullion is considered a safe investment during economic and geopolitical uncertainty.

“The markets remain firmly in risk-off mode so I would expect any gold price dips to catch bids,” said StoneX analyst Rhona O’Connell.

However, Trump’s policies are seen as inflationary, which could push the U.S. central bank to maintain interest rates higher for longer. This could pressure gold as it yields no interest.

Spot silver fell 0.2% to $30.44 per ounce.

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Palladium dropped 1.4% to $931.39 and platinum shed 0.8% to $934.95. Both metals are used by automakers in engine exhausts to reduce emissions.

Trump on Monday revoked a 2021 executive order signed by his predecessor Joe Biden that sought to ensure half of all new vehicles sold in 2030 were electric.

“If there were confidence in these policies, we’d likely see an upward blip, but instead, we’re in a “wait-and-see” mode,” O’Connell said.