Donald Trump's U-turn on gold tariffs erases record gains, shaking a $36B Swiss bullion trade & global investor confidence
From record highs to sharp declines
On Friday, gold futures surged to unprecedented levels following reports that the US planned to impose tariffs on imported 1kg bars. The move was viewed as a blow to Switzerland, which dominates global bullion exports, sending $36 billion worth of gold to the US in the first quarter alone. The country was already facing a 39% tariff on all its exports, from gold to luxury goods.
Trump's statement reversed the trend, sending US gold futures down 2.4% to $3,407 per ounce, narrowing the gap with spot gold, which fell 1.2% to $3,357. By Tuesday, prices were stable as investors turned their attention to upcoming US inflation data.
Swiss bullion sector welcomes statement, awaits formal decision
The Swiss Association of Precious Metals Producers and Traders (ASFCMP) welcomed Trump's assurance but stressed the need for a binding decision. 'President Trump's statement is an encouraging signal for trade stability,' said Christoph Wild, the group's president, adding that only a formal ruling could provide the certainty required by the sector.
The White House said an executive order was being prepared to address 'misinformation' about tariffs on gold bars and other products.
Confusion over tariff rules sparked market disruption
The market unrest began when US Customs and Border Protection said that 1kg and 100-ounce cast bars would not be exempt from tariffs. The clarification came after a metals financier sought legal advice when faced with unexpected duties.
Ross Norman, chief executive of Metals Daily, said shipments to New York were held back in bonded warehouses until the White House could confirm its position. 'It will come as an enormous relief to the bullion markets, as the potential for disruption was incalculable,' he said.
Bullion as a safe haven
Gold remains a popular hedge against inflation, attracting both individual buyers and sovereign funds. In the US, gold is sold in supermarkets, with a kilo bar priced at around £89,000 and one-ounce coins at about £2,500. Bullion refers to gold or silver that is at least 99.5% pure, typically in bar or ingot form.
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