Gold prices soar to fresh high amid Trump tariff turmoil

Pound, gold and oil prices in focus: commodity and currency check, 11 April

Fri, Apr 11, 2025, 2:42 AM 4 min read

Gold (GC=F)

Gold prices rallied on Friday, notching fresh highs, as investors flocked to the safe haven asset amid uncertainty over US president Donald Trump's tariff blitz.

Gold futures (GC=F) jumped 1.4% to $3,223.30 per ounce at the time of writing, while the spot price rose 0.9% to $3,205.47 an ounce.

Trump's announcement on Wednesday of a 90-day pause on many higher tariffs offered some relief for markets, though the 10% baseline levy announced last week was kept in place. In addition, Trump said he would raise the tariff rate on China to 125%, which came after Beijing announced an 84% import tax for US goods, up from 34%.

On Thursday, the White House then clarified that total tariffs on China would be 145%, as this included a pre-existing 20% levy on companies which produce fentanyl. China's finance ministry then said on Friday it would impose 125% tariffs on US goods from Saturday.

US stocks fell sharply on Thursday following the news, with the S&P 500 (^GSPC) closing the session 3.5% in the red, retreating after the US market saw one of its best days on record on Wednesday.

The escalation in trade tensions between the US and China, leading to heightened volatility in stock markets, has seen investors flock to gold. In addition to concerns that tariffs will drive inflation higher, there are fears that a trade war will tip the global economy into recession. Gold is considered to offer a store of value when inflation rises and the dollar falls, as the precious is typically traded in the US currency.

"One of the repercussions of the White House moves has been to bring the validity of US haven destinations such as the dollar and Treasury bonds into question, both of which have suffered," said Richard Hunter, head of markets at Interactive Investor. "Instead, investment flows have been heading towards currencies such as the Swiss franc and the yen, as well as gold which continues to test new highs and has risen by 21% this year alone."

Pound (GBPUSD=X, GBPEUR=X)

The pound rose against the dollar (GBPUSD=X) on Friday morning, up 0.6% at $1.3044, as data showed that the UK economy grew by more than expected in February.

The UK's gross domestic product (GDP) grew by 0.5% in February, according to the Office for National Statistics (ONS), which was above the 0.1% increase forecast by economists polled by Reuters. That compared to no growth in January, which had been revised up from a previous estimate of a 0.1% contraction.

"On the face of it, an unexpected GDP jump is great news for the UK economy. In February, the UK had one of its best months in terms of both production and services," said George Lagarias, chief economist at Forvis Mazars.

"However, one has to consider the following: A) Strong growth could delay the second rate cut by the Bank of England, which is expected in May. B) The data continues to reflect a pre-global tariff regime," he said.

"While welcome, it tells very little about how the UK economy will fair in an era of sharply increasing global macroeconomic and financial volatility. That is not to say we expect growth to plunge headlong, even if global growth slows."

Lagarias said that some Forvis Mazars clients had indicated that they would be willing to bring work from the US to the UK to avoid tariffs and uncertainty.

"We are entering a period where the data may jump around, reflecting rising risks, but also new opportunities for the British economy," he said.

Strength in the pound was also helped by a weaker greenback, with the dollar index (DX-Y.NYB), which measures the US currency against a basket of six currencies, down 0.8% at 100.06 at the time of writing. This was lowest point for the dollar index since September, as investors grappled with continued uncertainty over Trump's tariff policies.

Meanwhile, the pound was down 0.7% against the euro (GBPEUR=X), trading at €1.1498.

Oil (BZ=F, CL=F)

Oil prices rose on Friday morning, but still remain at their lowest point since 2021, with concerns that the impact of tariffs on the global economy could weigh on fuel demand.

Brent crude futures rose 0.5% to $63.67 a barrel, while US West Texas Intermediate (WTI) crude were up 0.6% to $60.41 a barrel.

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Derren Nathan, head of equity research at Hargreaves Lansdown, said: "It’s a challenging time for oil producers. Those with robust trading functions are likely to be seeing some benefit from the volatility.

"Firms with strong balance sheets and competitive production costs are those with the best chance of being able to stick to their investment commitments and maintain shareholder payouts through the cycle," he said. "For the wider economy if prices remain depressed it may take the edge off inflationary pressures."

In broader market movements, the FTSE 100 (^FTSE) fell 0.3% to 7,889 points on Friday morning. For more details, check our live coverage here.

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