Gold gains as Trump doubles India tariffs, boosting safe-haven demand
Spot gold was up 0.4% at $3,380.76 per ounce as of 0247 GMT. U.S. gold futures gained 0.3% to $3,443.30.
"Trump has been dishing up fresh tariff threats which is keeping gold in the frame as a defensive play for investors," Tim Waterer, chief market analyst at KCM Trade said.
"Gold is moving towards the doorstep of the psychological $3400, with risk-assets being kept off-balance somewhat by the constant tariff proclamations by the U.S. President."
Trump on Wednesday slapped an additional 25% tariff on imports of Indian goods, citing New Delhi's continued buying of Russian oil, deepening a trade rift between the two nations after talks reached a deadlock.
The new import tax, effective 21 days after August 7, will raise duties on some Indian exports to as high as 50% - among the highest levied on any U.S. trading partner.
Adding to gold's support, the dollar index (.DXY), opens new tab hovered near a more than one-week low after surprisingly weak U.S. jobs data last week triggered bets for U.S. rate cuts in September. A weaker dollar makes gold less expensive for holders of other currencies.
Traders are now pricing in a 94% chance of a 25-basis point rate cut next month, according to the CME Group's FedWatch Tool, opens new tab.
The Federal Reserve may need to cut rates in the near-term in response to a slowing U.S. economy, even though it remains unclear whether tariffs will continue to push inflation higher, Minneapolis Fed President Neel Kashkari said.
Gold, traditionally considered a safe-haven asset during political and economic uncertainties, tends to thrive in a low-interest-rate environment.
Elsewhere, spot silver rose 0.3% to $37.98 per ounce, platinum lost 0.7% to $1,324.26 and palladium shed 0.8% to $1,141.56.
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