Gold and Silver Surge to Record Highs Following Trump’s New China Tariff Threat
Gold and silver have reached unprecedented prices, continuing a longstanding trend amid rising geopolitical tensions. The recent tariff threats by U.S. President Donald Trump against China have heightened investor interest in safe-haven assets.
Gold and Silver Prices Surge
As of October 13, gold hit a record high of $4,084.75 per ounce. Spot gold was trading at $4,075.29/oz, reflecting a 1.4% increase. Simultaneously, U.S. gold futures for December delivery surged by 2.4%, reaching $4,094.90.
Silver also experienced a significant boost, reaching an all-time high of $51.70/oz, before settling at $51.48/oz, a 2.4% increase.
Impact of Tariff Threats
Trump recently escalated U.S.-China trade tensions by threatening 100% tariffs on Chinese imports. This move follows new export controls on critical software, set to take effect on November 1. In a contrasting statement made via Truth Social, Trump assured that concerns regarding China will be addressed.
Market Reactions and Forecasts
Market analysts emphasize that the ongoing trade disputes are pivotal for investors. UBS analyst Giovanni Staunovo commented on the demand for gold, forecasting a potential price increase to $4,200/oz due to sustained investment and central bank purchases.
- Gold’s 2026 price forecast: $5,000/oz (BofA)
- Silver’s 2026 price forecast: $65/oz (BofA)
Goldman Sachs noted that while silver is likely to see medium-term price increases driven by private investment, near-term volatility poses risks compared to gold. Both metals are currently overbought, with respective relative strength indices of 80 and 83.
Factors Driving Growth
Year-to-date, gold prices have escalated by 53%, fueled by:
- Geopolitical tensions
- Strong central bank demand
- Inflows into exchange-traded funds
- Expectations of Federal Reserve interest rate cuts
Market speculation anticipates rate cuts of 25 basis points in October and December, with high probabilities of these changes occurring.
Fed Chair Jerome Powell is expected to provide insights on monetary policy during his address at the NABE annual meeting on October 13. Several other Federal Reserve officials are also slated to speak this week, potentially influencing market dynamics further.
Price Movements in Other Precious Metals
Additional precious metals saw price increases as well:
- Platinum rose 3.9% to $1,649.49
- Palladium gained 2.7% to $1,443.08
The surge in gold and silver prices reflects a complex interplay of economic factors, investor sentiment, and global events. This dynamic landscape suggests continued volatility and opportunity in the precious metals market.
