MARKET NEWS

BY Yihui Xie and Jack Ryan

(Bloomberg) — Gold (GC=F) edged toward the record high set on Monday, as the Trump administration pressed ahead with probes that could broaden the US’s sweeping trade war.

Bullion rose to near $3,223 an ounce, just over $20 below the peak set in the first trading session of the week. The US Commerce Department said Monday it had initiated probes into the national security impact of semiconductor and pharmaceutical imports, a precursor to imposing tariffs.

The precious metal has rallied by more than a fifth this year as the worsening trade war has damped prospects for global growth, eroded trust in usually-safe US assets and roiled financial markets. Treasury Secretary Scott Bessent played down the recent selloff in the bond market, while flagging that his department has tools to address dislocation if needed.

Federal Reserve Governor Christopher Waller, meanwhile, said that the inflationary impact of the trade war would be temporary, with interest-rate cuts “very much” on the table in the second half. Lower borrowing costs typically aid gold, which doesn’t pay interest.

Leading banks remain optimistic about bullion’s prospects over the coming quarters as investors add to holdings in gold-backed exchange-traded funds and central banks continue to accumulate the metal. Goldman Sachs Group Inc. has forecast that prices will rally to $4,000 an ounce by mid-2026.

Gold may also find support from strong demand in China, the world’s biggest bullion market. As the trade war has intensified, there’s been a surge in speculative trading, as well as inflows into local ETFs.

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