Trump's tariff threats fuel trade war fears
Supreme Court to hear case on firing Fed governors on Wednesday
Gold gains more than 70% since Trump's second term began
Updates with European morning session
By Anjana Anil
Jan 20 (Reuters) - Gold surged past the $4,700 an ounce mark for the first time on Tuesday, and silver hovered just below a fresh record high, as global tensions sparked yet another rush to safety.
Spot gold XAU= gained 1.3% to $4,727.99 per ounce by 0910 GMT, having hit an all-time high of $4,731.34, while silver XAG= rose 0.7% to $95.34 an ounce, after hitting a record high of $95.488 earlier in the session.
U.S. gold futures GCcv1 for February delivery climbed 3% to $4,734.10 per ounce.
U.S. President Donald Trump threatened to impose increasing tariffs from February 1 on eight European countries until the U.S. is allowed to buy Greenland, fuelling fears of a renewed trade war.
"Growth concerns driven by threats of additional tariffs and the desire of Trump to have lower U.S. interest rates are the drivers pushing gold to a new record high," said UBS analyst Giovanni Staunovo.
Gold has climbed 9.5% in just 20 days of this year and over 70% since Trump's second term began a year ago. Geopolitical tensions have been at the forefront of the recent record rally, with expectations of monetary policy easing also playing a significant role. Strong central bank buying and ETF inflows have also contributed to the unprecedented rise.
Instability in policy and politics drives investors to store value in traditional safe havens like gold, while lower interest rates limit the downside of holding non-yielding assets.
Investors are also awaiting a decision on a Supreme Court case that could determine whether the president can dismiss Federal Reserve governors at will, concerning Trump's attempts to fire Fed Governor Lisa Cook.
"We still see further upside for the yellow metal, targeting a price of $5,000/oz," Staunovo said.
Silver rose 147% in 2025, supported by its designation as a U.S. critical mineral, and a structural market deficit amid growing demand. The metal has gained 33.7% so far this year.
Spot platinum XPT= added 0.5% to $2,387.15/oz. Palladium XPD= firmed 0.2% to $1,844.81.
gold-and-silver-annual-performances-2019-2025- (1) https://tmsnrt.rs/3NfeEou
Gold trades above key moving averages https://tmsnrt.rs/45Sk6E5
(Reporting by Anjana Anil in Bengaluru, additional reporting by Swati VermaEditing by Tomasz Janowski)
((Anjana.Anil@thomsonreuters.com;))
