Gold futures hit record; Swiss gold refining sector stung by US tariffs
NEW YORK: Gold futures hit a record high Friday following reports of an unexpected tariff on the precious metal as global stocks finished the week on a mixed note. Wall Street enjoyed a sunny Friday led by the tech-rich Nasdaq Composite Index, which posted a second straight record, part of a buoyant session in New York amid optimism over artificial intelligence and less uncertainty over trade policy.
Investors are growing confident that President Donald Trump's constantly-changing US trade policy won't derail the surge in investment around artificial intelligence.
Gold futures shot to a new all-time intraday high at $3,534.10 an ounce after the Financial Times reported that Washington had classified one-kilo bars, the most traded type of bullion on Comex—the world's biggest futures market, as subject to 'reciprocal' tariff rates. One-kilo bars make up the largest part of Switzerland's gold shipments to the United States. Imports from Switzerland face a 39-percent reciprocal tariff from Thursday. The FT said 100-ounce bars would also face the levy.
The levy caused 'shock and confusion' in markets, said Han Tan, chief market analyst at Nemo.money trading group. After hitting the high, the gold future price later pulled back to around $3,454 an ounce.
The first casualty of a hefty 39-percent tariff on Swiss imports into the United States may be gold refining, after it emerged that certain gold bars could face the levy. The price of gold on the US futures market hit a record high Friday after US customs authorities clarified that gold bars weighing either one kilogram or 100 ounces (2.8 kilograms) should be classified as subject to so-called reciprocal tariffs.
The July 31 letter was first reported late Thursday by the Financial Times. But a White House official told AFP that President Donald Trump's administration plans to 'issue an executive order in the near future clarifying misinformation about the tariffing of gold bars and other specialty products'. It was not immediately clear if this meant the products would therefore be exempt from Trump's 'reciprocal' levies, imposed to address what Washington deems as unfair trade deficits.
One-kilo gold bars are the most traded type of bullion on Comex—the world's biggest futures market—and Switzerland is a major supplier of the bars on the physical market.
Expectations had been widespread that gold bars would be classified under a different customs code that excludes them from Trump's countrywide tariffs. Higher 'reciprocal' rates took effect Thursday on dozens of economies. Swiss officials travelled to Washington this week to seek a deal similar to the European Union, whose products now face a 15-percent rate. But they came back empty handed.
The customs update increased pressure on the Swiss government as gold trading weighs heavily on its trade balance.
John Plassard, head of investment strategy at Cite Gestion, expects some of the gold refining business would likely flow to other industry centers such as Antwerp. Gold bars produced in the Belgian city Antwerp face a 15-percent US tariff applied to EU goods.
Switzerland is home to four of the world's largest gold refineries, the largest being Valcambi in Balerna, in the Italian-speaking part of the country. They import unrefined gold coming from mines, recycled jewelry or lower-purity bars to be recast into high-quality bars, making Switzerland a hub for the global gold trade. These bars are then reintroduced to the market for jewelry, watchmaking, industry and tech products, as well as the banking sector and for use as central bank reserves.
According to a Swiss Federal Customs Administration report, the country imported 2,372 tons of gold in 2023 and re-exported 1,564 tons. The value of these exports approached 88 billion Swiss francs ($109 billion at current rates), with the main buyers being China at 25.1 billion francs and India at 13.1 billion francs. Including other precious metals like silver and palladium, the sector accounts for 1,500 direct jobs in the country and 1,000 indirect jobs, according to the Swiss association of manufacturers and traders of precious metals. In 2023, Switzerland accounted for 34 percent of the total refined gold worldwide, according to the State Secretariat for Economic Affairs (SECO).
Swiss gold exports to the United States soared to 11 billion Swiss francs last year, nearly doubling from 6.1 billion in 2023. They then skyrocketed in the first half of 2025, reaching 39.2 billion francs, compared to nearly 1.7 billion in the first half of 2024, according to data Swiss customs provided to AFP. Nearly all of the gold -- 37.6 billion francs' worth—was exported in the first quarter of 2025. Shipments then plummeted sharply to roughly 1.6 billion francs in the second quarter. Swiss President Karin Keller-Sutter on Thursday strongly disagreed with how Trump assessed the US trade deficit with Switzerland, and thus the high tariff imposed.
She said the rise in gold exports in 2024 had led to the increase in the deficit. Swiss newspaper Le Temps noted Tuesday that to calculate customs duties on Switzerland 'the White House seems to have relied exclusively on 2024 data,' which was 'an atypical year'. Swiss gold exports to the United States skyrocketed in November, when Trump won the presidential election, triggering a surge in 'safe haven' investments such as gold, it said. – AFP
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