Gold nears two-month high as investors brace for Protectionist policies
Gold prices increased in early Wednesday trading, reaching levels not seen since early November. So far, it has been a good week for gold bugs, with the precious metal gaining nearly two per cent. Since the inauguration of the new US president, demand for haven gold has increased as investors seek protection against the perceived risks of the incoming administration's push for protectionism, which could disrupt trade and long-established global balances. With China and key US allies such as the EU and Canada in the crosshairs of Donald Trump's efforts to overhaul international trade and pursue a protectionist agenda, uncertainty lingers over the extent of these measures, driving further appetite for gold as a haven asset. However, the precious metal faces headwinds that may limit its upside. The tariffs promised by the new administration are likely to raise inflation and strengthen the dollar, exerting downward pressure on gold prices.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
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