Gold touches new high and stock markets slump as Trump says tariffs will hit all countries

Precious metal price crossed $3,110 an ounce on Monday as trade war fears rise

Bullion prices are being supported by growing haven demand amid rising economic uncertainty. Getty Images

Gold hit a record on Monday morning, touching more than $3,110 an ounce, while stock markets dropped after US President Donald Trump’s latest remarks that tariffs will hit all countries. This further stoked concerns about a trade war that could dent economic growth around the world.

The precious metal was trading at $3,110.76 an ounce at 8.34am UAE time on Monday, with prices supported by growing haven demand. Gold prices are up by about 6.5 per cent in the last month and about 16 per cent in the last six months on rising geopolitical and macroeconomic uncertainties.

Mr Trump on Sunday said new tariffs that he plans to announce on Wednesday, in a move he has called “liberation day”, will hit all countries and not just those that have the biggest trade imbalances with the US.

“You'd start with all countries,” he told reporters on Air Force One. “Essentially all of the countries that we're talking about.”

The levies will be in addition to those imposed on aluminium, steel and vehicles, as well as increased tariffs on all goods from China.

Asian stocks also fell on Monday, with Japan's Nikkei 225 index down about 4 per cent and South Korea's benchmark Kospi index dropping by nearly 3 per cent. Hong Kong’s Hang Seng index was 1.7 per cent lower, the Shanghai Composite index was 0.97 per cent lower and Taiwan's Taiex was down 3.75 per cent.

US stock futures were also down on Monday morning, with the S&P 500 and the Nasdaq futures down 0.77 per cent and 1.36 per cent, respectively.

“The tariff talk remains on the headlines as the liberation day approaches,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank. “Risk appetite is nowhere to be found, the US dollar is weak, gold continues to extend gains into uncharted territories.”

Global stock markets have faced increased volatility since Mr Trump followed through with his campaign promise to levy duties on some of the US’s biggest trade partners.

Last week, he put a 25 per cent levy on all cars not made in the US. The country, the world's largest steel and aluminium importer, this month also introduced 25 per cent tariffs on all imports of the metals, which are used in construction, the car industry, energy and manufacturing. The move is designed to stimulate domestic processing.

Mr Trump has also planned a 10 per cent tariff on Canadian energy products that fall outside the US-Mexico-Canada Agreement he negotiated during his first term.

The President has also announced 25 per cent tariffs on imports from Canada and Mexico and has said he would add another 10 per cent tariff on goods from China, on top of the 10 per cent he put in place in February.

Mr Trump's tariff strategy has sparked concerns of a trade war that could drive up prices and hamper economic growth. Goldman Sachs lowered its 2025 gross domestic product forecast for the US to 1.7 per cent from 2.4 per cent, citing tariff uncertainty.

“Last week’s US GDP update showed a slightly better reading on Thursday, but growth in US GDP fell from above 3 per cent to 2.4 per cent in the fourth quarter, and is expected to contract by nearly 3 per cent in the first quarter, according to the latest update from Atlanta Fed’s GDP Now forecast,” Ms Ozkardeskaya said.

The rising uncertainty has pushed up the demand for gold, with expectations that prices could go even higher. Last week, Goldman Sachs increased its forecast for gold to hit $3,300 an ounce by year-end. The bank cited higher-than-expected central bank demand and strong inflows into bullion-backed exchange-traded funds.