Gold prices moved higher in early trading on Monday as US and China introduced a new round of tariffs on each other’s goods, which left investors seeking out the precious metal as a safe haven
The United States introduced some new 15% tariffs on a variety of Chinese goods on Sunday - including footwear, smart watches and flat-panel televisions and China immediately retaliated by imposing new duties on some US goods.
U.S. President Donald Trump left the door open for a compromise saying the world’s two superpowers would still meet for talks later this month which if successful may lead to the cancelation of a bigger round of tariffs due to take effect in December and would cover virtually all Chinese goods entering the US.
There have been a lot of attempts in recent months to deescalate the trade war by both sides to no avail and until some major concrete steps are taken to find a solution, safe haven assets such as gold are going to remain well supported.
“The reality of the trade war with the new tariffs being implemented over the weekend has kept a risk-off tone in markets this morning,” said ANZ analyst Daniel Hynes.
“There is still a very high level of skepticism. Traders want to see talks restart with both parties suggesting some positive outcomes before any optimism around the progress sets in,” he added.
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