Gold prices soared to a new all-time high above $3,120 at the start of the week as investors sought safe-haven assets amid escalating tariff fears. Meanwhile, markets are closely watching key economic data and geopolitical developments.
Tariff Uncertainty Weighs on Markets
Over the weekend, the Wall Street Journal reported that advisers to U.S. President Donald Trump are considering imposing global tariffs of up to 20% on all imports into the United States. The administration is expected to unveil its detailed tariff strategy on Wednesday. Additionally, Trump warned on Sunday that if he perceives Moscow as obstructing his efforts to end the war in Ukraine, he would impose secondary tariffs of 25%-50% on buyers of Russian oil.
The uncertainty surrounding trade policy has contributed to a risk-averse market environment. U.S. stock index futures were last seen declining between 0.4% and 1.2%, while the U.S. Dollar Index edged lower, trading just below 104.00 during the European session. Later in the day, investors will assess economic indicators, including the Federal Reserve Bank of Dallas’ regional manufacturing survey and the Chicago Purchasing Managers’ Index for March.
Currency Markets React to Market Sentiment
The U.S. dollar faced pressure against major currencies. USD/JPY extended Friday’s losses, dropping over 0.6% to trade below 149.00. Investors now turn their attention to Japan’s February unemployment rate, set to be released early Tuesday.
EUR/USD rebounded after a six-day decline, posting gains on Thursday and Friday. The pair remained stable above 1.0800 in early European trading. Fresh data from Germany revealed a 0.8% monthly increase in retail sales for February, surpassing market expectations of no change.
GBP/USD ended last week slightly higher but struggled to sustain Thursday’s momentum. The pair maintained stability above 1.2950 in early European trade.
Meanwhile, AUD/USD remained under pressure, trading below 0.6300. Investors await the Reserve Bank of Australia’s (RBA) monetary policy decision on Tuesday, with expectations that the central bank will keep its benchmark rate steady at 4.1%.
As markets navigate uncertainty surrounding trade policies and economic data releases, investor sentiment remains cautious, with gold continuing to benefit from risk aversion.
