Gold prices fell nearly 1% on Monday, February 3, 2025, after reaching an all-time high in the previous session. The decline occurred as the US dollar strengthened amid escalating global trade tensions.CompanyValueChange%ChangeSpot gold dropped to $2,776.05 per ounce, down from Friday’s (January 30’s) record peak of $2,817.23 per ounce.US gold futures also decreased to $2,810.80 per ounce.
The US dollar index hovered near a three-week peak, making greenback-priced gold more expensive for foreign buyers.In India, gold prices slipped by ₹10 to ₹84,480 per 10 grams in major cities.The yellow metal hit an all-time high of ₹84,490 per 10 grams on Saturday (February 1).President Donald Trump imposed 25% tariffs on imports from Canada and Mexico and 10% on goods from China, effective Tuesday. In response, Canada and Mexico ordered retaliatory measures, while China plans to challenge the tariffs at the World Trade Organisation.
Analysts suggest that demand for safe-haven assets like gold may limit immediate downside risks.However, the strong US dollar could inhibit potential gains.Tim Waterer, chief market analyst at KCM Trade, noted, “Markets are looking rattled about the tariff dramas and demand for safe-haven assets such as gold could look to limit the immediate downside… though the soaring US dollar could be an inhibiting factor.”He added that the $2,750 per ounce range would need to hold to protect from a larger pullback.Bullion is considered a safe investment during periods of economic and geopolitical turmoil. Citi analysts believe that further tariff escalation should be bullish for gold and will likely push prices to $3,000 per ounce.Meanwhile, JP Morgan noted that bearish contagion from equities could weigh on gold in the immediate near-term but disruptive tariffs continue to fuel a medium-term bull case for bullion.Rahul Kalantri, VP Commodities at Mehta Equities, noted that gold is holding the key support levels of $2,722 per ounce on a weekly closing basis in the international markets.Looking ahead, gold has support at $2,774-$2,760 per ounce, while resistance is at $2,817-$2,832 per ounce. In rupee terms, gold has support at ₹81,980-₹81,710 per 10 grams, while resistance is at ₹82,070-₹82,350 per 10 grams.-With Reuters inputs
