Trump tariffs fire up precious metals, gold surges past $3,000

The driving factors of gold price and Wall Street forecast analysis
First, the recent performance of gold prices and breakthroughs in key thresholds
Historic breakthrough • On March 13, 2025, the New York gold futures (COMEX) price broke through $3,000 / ounce for the first time, an increase of more than $50 per day, a record high; Spot gold prices climbed to close to $2,985 an ounce, up 13% year-to-date. • Higher price forecasts: Macquarie expects gold prices to average $3,150 an ounce in the third quarter, with a potential single-point peak of $3,500, matching the all-time inflation-adjusted high set in 1980. BNP Paribas, Goldman Sachs and other institutions also raised the target price to $3,100 / ounce (second quarter) and $3,100 / ounce (year-end).
Second, the core factors driving the rise of gold prices
Geopolitical and trade policy uncertainty • Trump tariff threat: The United States imposed steel tariffs (25%) and alcohol tariffs (200% threat) on Canada, the European Union, etc., triggering market concerns about a global trade war and boosting demand for safe havens. The Trump administration's policy reversals, such as the suspension of some tariffs, have added to market volatility, prompting institutions to move physical gold into New York vaults to avoid potential tariffs. • Rising inflation expectations: Tariffs could push up the price of imported goods, combined with a worsening U.S. fiscal deficit (1.5 percentage points higher in 2025), and longer-term inflation concerns support gold prices. 2. Fed policy and economic data weakness • interest rate cut expectations increased: the US service sector PMI in February fell below the line of growth and contraction, GDP growth expectations were lowered to recession levels, the market bet that the Federal Reserve cut interest rates three times within the year, the real interest rate downward to reduce the opportunity cost of holding gold. • Weakening of the US dollar and US Treasuries: The strengthening of the US dollar has failed to suppress the gold price, and the fall in US Treasury yields further highlights the safe-haven properties of gold. 3. Surge in central bank gold purchases and investment demand • Increase in official reserves: Global central banks bought 18 tons of net gold in January 2025, and China increased its gold holdings for four consecutive months to 2,289 tons; Emerging markets (such as India and Uzbekistan) continue to expand their gold reserves. • Institutional arbitrage: The spread between London and New York gold prices widened to $58 an ounce, sparking a carry trade that helped COMEX gold stocks surge from 681 tonnes to 1,221 tonnes.
Third, the forecast logic of Wall Street institutions and market sentiment
Macquarie's core argument • A haven premium: Investors are willing to pay a higher premium for gold with no credit risk, even though its zero yield is seen as a disadvantage in a traditional high interest rate environment. • Debt crisis concerns: The risk of a US government shutdown and unsustainable fiscal deficits (congressional budget deficit projections have worsened) strengthen gold's function as a currency substitute. 2. Additional analysis from other institutions • BNP Paribas: Highlights the geopolitical turmoil triggered by Trump's reshaping of international relations, driving demand for gold as the "ultimate safe haven." • Goldman Sachs and Mizuho Securities believe gold's rise reflects anxiety about "nowhere to hide," accelerating institutional inflows into gold ETFs and futures markets.
Fourth, industrial chain impact and market response
The profit surge of upstream mining enterprises • The cash cost of domestic gold mines is about 350-400 yuan/gram, and the current gold price has reached a historical peak of mining profits. Zijin Mining, Shandong Gold and other enterprises in 2024 net profit increased by more than 50%, gross margin increased to 45%. 2. Middle and downstream pressure and industry differentiation • Processing and retail end weakness: terminal consumer demand slowed down, the Shanghai Gold Exchange from January to February gold storage volume fell 18% year-on-year, Chow Tai Fook, Lao Fengxiang and other brands net profit declined. • Active recycling market: In 2024, the global gold recovery volume reached 1370 tons (+11% year-on-year), and individual investors accounted for 72%, and the recycling price spread in Shenzhen Shuibei market narrowed to 8 yuan/gram.
V. Future risks and prospects
Upside potential and downside risks • Supporting factors: If the US economy falls into stagflation or the independence of the Federal Reserve is under political pressure (such as Trump's pressure to cut interest rates), gold prices may soar further. • Potential negative: the Russia-Ukraine ceasefire agreement or the Federal Reserve's delay in interest rate cuts may trigger a correction in gold prices and technically face resistance at the $3,000 mark. 2. Investment strategy advice • Use of hedging tools: enterprises need to use futures and options to manage inventory risks, and retail investors can disperse allocation through gold ETFs and spot contracts. • Focus on policy inflection points: The landing of Trump's final tariff plan in April and changes in US economic data will be the key drivers of short-term price volatility.
Sum up
This rally in gold is the result of multiple resonances of geopolitical conflicts, policy games, economic cycles and market sentiment. Despite the short-term risk of a technical correction, gold's long-term safe-haven and store of value function is still widely favored against the backdrop of high global debt, de-dollarization trend and central bank gold buying tide. Investors need to be alert to abrupt policy changes and use financial instruments flexibly to cope with volatility.