Gold prices are increasing due to trade tensions, weak US dollar, and bullish forecasts
From Investing.com: 2025-04-16 04:15:00
Analysts are bullish on gold for 2025, as escalating trade tensions and concerns over global economic growth drive up demand for the precious metal. Gold prices have hit record highs this year, gaining more than 25% since the beginning of the year. Major banks like ANZ and Goldman Sachs have raised their gold price forecasts for the year, expecting prices to continue climbing. The weak US dollar is also supporting the price of gold, making it more affordable for holders of other currencies. Investors are closely watching Fed Chair Powell’s speech and the US Retail Sales report for more clues on the interest rate path.
The euro lacks a clear trend direction amid escalating trade tensions, with the euro strengthening against the US dollar as the greenback weakens. China’s order for its airlines not to take further deliveries of Boeing jets and US President Trump’s consideration of modifying tariffs on auto imports add to the uncertainty. While the eurozone’s economic outlook remains bleak, the recent EUR/USD rally is more due to a loss of confidence in the US dollar than a rise in confidence in the euro. Investors are cautious and continue to favor safe-haven currencies like the Swiss Franc and Japanese Yen.
The Australian dollar is benefiting from a weakening US dollar, as the greenback struggles to find support. Capital outflows from the US towards safe-haven currencies like the Swiss Franc and Japanese Yen are supporting the Australian dollar. Positive macroeconomic data from China, a major export market for Australia, have also boosted the Aussie. However, rising tariffs are expected to slow down the Chinese economy in the long run. Traders are focusing on trade tariff tensions, Fed Chair Powell’s speech, the US Retail Sales report, and the Australian jobs report for further direction on AUD/USD.
Read more at Investing.com: Gold Prices Rise Amid Trade War Tensions and US Dollar Weakness