Gold prices fell on Friday as investors began reassessing the risk outlook after new tariffs announced by US President Donald Trump. Although this move brings more clarity about market trends, it raises concerns about the risk of economic recession.
At 7:10 a.m. GMT, spot gold fell 0.4%, down to $3,101.01/ounce. However, gold is still on track to record its fifth consecutive week of gains, thanks to its safe-haven role a factor that has helped gold prices set a record of three times this week.
US gold futures increased slightly by 0.1% to $3.123/ounce.
In the previous session, gold decreased by more than 2% due to a widespread sell-off in the market, originating from Mr. Trump's decision to impose import tariffs, which had a strong impact on the psychology of gold investors.
Notably, this sharp decline came just hours after gold prices set a new record of $3,167.57/ounce.
Ilya Spivak - Head of Global Macro Strategy at Tastylive commented: "Gold often increases strongly during periods of uncertainty such as when war first broke out - but will gradually lose momentum as the market gradually evaluates related risks".
He added: The Trump administration has now chosen a direction. Although the market may not like it, at least the road ahead is clearer and more predictable, leaving gold no longer benefiting from market uncertainty."
President Trump has said he will impose a basic 10% tax on all imports into the US, along with higher rates for some major trading partners.
In response, US trading partners threaten to push up trade tensions, as new tariffs could spike commodity prices in the world's largest consumer market.
Federal Reserve officials are looking for more details about Trump's trade plan, but they may have received more than expected when he announced a series of comprehensive tax measures. Analysts say this could significantly change the US economic picture.
Currently, the market is waiting for the US non-farm payrolls report to assess the possibility of changing the Fed's interest rate policy.
Spot silver prices fell 1.5% to $11.4 an ounce, platinum fell 0.8% to $944.8/ounce, while the price of gold almost moved sideways at $928.33 an ounce.
