Gold News: Safe-Haven Demand Builds With Tariffs Rising and PCE Still to Come

Record Highs as Tariff-Driven Inflation Fuels Safe Haven Demand

Gold extended its rally on Friday, briefly hitting a new all-time high at $3,086.09 before pulling back slightly. The surge comes as mounting trade tensions and inflation risks fuel safe-haven flows, with traders bracing for the release of the U.S. PCE inflation report later today.

The latest leg higher in gold is driven by market fears that President Trump’s new round of reciprocal tariffs, set to take effect on April 2, will elevate inflation and destabilize global trade. Gold is up 2% on the week, on pace for its fourth straight weekly gain, as investors rotate into safety amid growing uncertainty over U.S. policy direction.

At 09:21 GMT, XAU/USD is trading $3072.16, up $15.55 or +0.51%.

Tariffs and Inflation Expectations Push Gold Above $3,000

The broader market is beginning to price in the inflationary impact of tariffs. Fed officials are divided on the effect—Boston Fed President Susan Collins expects a short-term inflation spike, while St. Louis Fed’s Alberto Musalem warns it may persist. His team estimates the tariffs could add over 1 percentage point to inflation.

Today’s PCE data—expected to show a 0.4% monthly rise in core inflation—may not fully capture the inflation that’s still to come. That gives gold added momentum as inflation hedging picks up. Core inflation is forecast to edge higher to 2.7% year-over-year, reinforcing the Fed’s cautious stance and reducing the likelihood of near-term rate cuts.

Fed Policy Uncertainty Adds Fuel to Bullish Gold Setup

Gold thrives in periods of policy uncertainty and weakening growth expectations. Business investment and hiring have reportedly slowed under current U.S. policy conditions. Richmond Fed’s Thomas Barkin compared the environment to driving with “zero visibility,” and consumer sentiment is falling as inflation fears rise.

Despite the current “moderately restrictive” stance from the Fed, traders see little reason for immediate easing, especially with February’s data lagging behind recent developments. That puts real rates and inflation expectations squarely in focus for gold.

Gold Prices Projections: Bullish Bias Intact Above $3,000

With technical support at $2,999.46 and the 50-day moving average rising to $2,902.18, gold remains structurally bullish. The lack of near-term resistance above $3,086 suggests a move toward the $3,100 level is in play.

Unless PCE data dramatically cools inflation fears, gold is likely to remain supported by safe-haven demand and inflation hedging, keeping the outlook bullish.

More Information in our Economic Calendar.