Gold edges higher on softer dollar, trade war intensifies
Spot gold rose 0.3% to $3,321.68 per ounce by 0608 GMT. U.S. gold futures were up 0.3% at $3,329.90.
"Gold bounced off a technical support level and also, the broader dollar declined," said Nicholas Frappell, global head of institutional markets at ABC Refinery.
Trump escalated his tariff campaign on Wednesday, announcing a 50% tariff on U.S. copper imports and a 50% duty on goods from Brazil, both effective on August 1.
Trump also issued tariff notices for seven minor trading partners, adding to 14 others issued earlier in the week, including 25% levies on imports from South Korea and Japan, set to take effect on August 1 unless agreements are reached.
"The market impact of tariffs seems to lessen with each new headline. Tariff fatigue is here, and traders need a new catalyst to awaken volatility from its lull," said Matt Simpson, a senior analyst at City Index.
The U.S. dollar index edged down 0.2%, while the yield on benchmark 10-year U.S. Treasury notes retreated from a three-week high.
Lower bond yields reduce the opportunity cost of holding non-yielding bullion, while a weaker dollar makes gold cheaper for holders of other currencies.
Minutes of the Federal Reserve's June 17-18 meeting showed that only "a couple" of Fed officials believed interest rate cuts could happen as early as this month, with most favouring reductions later this year due to inflation concerns tied to Trump's tariff policies.
The Federal Open Market Committee unanimously voted to hold rates steady at its June meeting. The next policy meeting is scheduled for July 29-30.
Spot silver edged up 0.2% to $36.42 per ounce, platinum fell 0.2% to $1,345.06, and palladium gained 0.3% to $1,108.18. - Reuters
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Star
2 hours ago
- The Star
US tariffs could hit Samsung phones, exempt China-made iPhones
Visitors at the Galaxy Unpacked 2025 event experience the Galaxy Z Fold7 smartphone at the Duggal Greenhouse in New York on July 9. - Photo: Samsung Electronics SEOUL: Samsung Electronics could face higher US tariffs on its smartphones and other finished electronics as early as this week, even as Apple's iPhones made primarily in China may be granted exemptions, industry sources said Tuesday (Aug 12). This would highlight a notable divergence in how major smartphone makers are treated under Washington's trade measures aimed at protecting US manufacturing and reducing reliance on Chinese supply chains. Industry officials said the US President Donald Trump's administration is considering tariffs of up to 25 percent on smartphones, laptops, monitors and other semiconductor-related finished goods. If applied at that rate, the base model of Samsung's Galaxy S25, currently priced at US$799.99, could rise by nearly US$200, while next year's Galaxy S26 series could see a 30-40 percent increase. Such a move could weaken Samsung's recent gains in the US market. The Korean tech giant held a 31 percent share in the second quarter, narrowing the gap with Apple to 18 percentage points from 33 percentage points a year earlier, according to Canalys. Apple, however, appears better positioned to secure tariff exemptions despite manufacturing about 90 percent of its iPhones in China, with the remaining 10 percent shared equally between Vietnam and India. The company recently pledged to invest $600 billion in new US production facilities over the next four years, creating 20,000 jobs and strengthening domestic supply chains — a plan developed in coordination with Washington. President Trump has signaled support for Apple's expansion, raising expectations that the company could be spared from the proposed tariffs. 'Apple's preemptive investment announcement appears to have been made with potential smartphone tariffs in mind,' said Kim Rok-ho, an analyst at Hana Securities. 'Even if semiconductors are exempted from tariffs, if devices like smartphones and PCs are included, Korean products will inevitably be at a disadvantage against Apple in the US market.' Samsung manufactures about 50-60 percent of its smartphones in Vietnam, with the rest produced in India, Korea and South America. It stopped handset production in China in 2019 after losing market share there. '(The US Department of Commerce) investigation is wide ranging from semiconductors to finished goods such as smartphones, tablets, PCs and monitors,' Samsung CFO Park Soon-cheol said in July. 'We expect the impact on our business to be significant.' A Samsung official said the company is 'closely monitoring' developments, noting that while price increases after product launches are unprecedented, they may be considered in 'special cases like tariffs.' According to an industry source familiar with Samsung's operations, "The firm is exploring options such as large-scale US investments or relocating some production to America," but "high labour costs and operational challenges remain a major concern," he added. - The Korea Herald/ANN
The Star
4 hours ago
- The Star
Swiss open to Federer or FIFA chief helping on US tariffs
ZURICH (Reuters) -The Swiss government would not object to tennis legend Roger Federer or FIFA President Gianni Infantino intervening to reduce the country's tariff burden after the U.S. slapped a 39% import duty on its goods, President Karin Keller-Sutter said. Some Swiss politicians have proposed their countryman Infantino as an informal negotiating channel with U.S. President Donald Trump after the U.S. leader attended the FIFA Club World Cup final in New Jersey in July. Trump is also a fan of celebrities and could be swayed by an approach by Federer, Swiss media has reported. "If personalities who know him have a conversation with him, we're not against it," Keller-Sutter told broadcaster Tele Zueri, when asked about Infantino or Federer speaking with Trump. "That's not a strategy we can officially pursue," she said, adding negotiations with Washington would be led by the government. "I don't know if that would actually help in the end." Switzerland has been left stunned by the 39% import levy - among the highest of any applied under Trump's global trade reset, which went into effect last week. Earlier in May, South African President Cyril Ramaphosa included popular golfers in his delegation that travelled to Washington hoping to discuss trade and reset strained relations with the U.S. During a tense White House meeting Trump confronted him with false claims of white genocide and land seizures. Keller-Sutter said she hoped talks to cut U.S. tariffs on Swiss exports could be settled by October, but warned Switzerland would not pay "any price" after an earlier agreement was brushed aside by Trump in a phone call between the two leaders on July 31. "The Federal Council is naturally striving to find a solution that will reduce customs tariffs," Keller-Sutter said. "I hope that is true," she said when asked about U.S. Treasury Secretary Scott Bessent's comments that trade issues could be resolved by October. The tariff was unjustified and must be reduced, she said, noting that Swiss companies were investing heavily in the United States. "It cannot be that, to put it simply, we just pay, worsen our business location and then still have high customs duties," she said. Still, Switzerland was a small country with no political power, which meant its leeway was limited, Keller-Sutter said. (Reporting by John RevillEditing by Tomasz Janowski)
The Star
4 hours ago
- The Star
US consumer prices increase moderately in July; data quality concerns rising
WASHINGTON: U.S. consumer prices increased moderately in July, though rising costs for goods because of import tariffs led to a measure of underlying inflation posting its largest gain in six months. The consumer price index rose 0.2% last month after gaining 0.3% in June, the Labor Department's Bureau of Labor Statistics said on Tuesday. In the 12 months through July, the CPI advanced 2.7% after rising 2.7% in June. Economists polled by Reuters had forecast the CPI rising 0.2% and increasing 2.8% year-on-year. Excluding the volatile food and energy components, the CPI rose 0.3%, the biggest gain since January, after climbing 0.2% in June. The so-called core CPI increased 3.1% year-on-year in July after advancing 2.9% in June. The Federal Reserve tracks different inflation measures for its 2% target. Prior to the CPI data, financial markets expected the U.S. central bank would resume cutting interest rates in September after July's weak employment report and sharp downward revisions to the nonfarm payrolls counts for May and June. The Fed left its benchmark overnight interest rate in the 4.25%-4.50% range last month for the fifth straight time since December. The CPI report was published amid mounting concerns over the quality of inflation and employment reports following cuts in budget and staffing that have led to the suspension of data collection for portions of the CPI basket in some areas across the country. Those worries were amplified by President Donald Trump firing Erika McEntarfer, the head of the BLS, early this month after stall-speed job growth in July, reinforced by sharp downward revisions to the May and June nonfarm payrolls counts. DATA COLLECTION SUSPENSION The suspension of data collection followed years of what economists described as the underfunding of the BLS under both Republican and Democratic administrations. The situation has been exacerbated by the Trump White House's unprecedented campaign to reshape the government through deep spending cuts and mass layoffs of public workers. Citing the need to "align survey workload with resource levels," the BLS suspended CPI data collection completely in one city in Nebraska, Utah and New York. It has also suspended collection on 15% of the sample in the other 72 areas, on average. This affected both the commodity and services pricing survey as well as the housing survey, which the BLS said resulted in the number of collected prices and the number of collected rents used to calculate the CPI temporarily reduced. That has led to the BLS using imputations to fill in the missing information. The share of different cell imputation in the CPI data jumped to 35% in June from 30% in May. Different cell imputation, which the BLS uses when all prices are unavailable in the home cell, maintains the item category but expands geography. The home cell method, considered by economists as higher quality, uses the average price of the same item in the same location as the missing product's price. The use of different cell imputation has grown from a share of only 8% in June 2024. Economists said while these measures adopted by the BLS will not introduce bias in the CPI data, the volatility was a cause for concern. - Reuters
