Investing.com-- Gold prices climbed Monday, topping $3,000 as safe haven demand remained underpinned by uncertainty over trade tariffs and a slowing economy.
Haven demand was also boosted by increased geopolitical ructions in the Middle East, after the U.S. launched a wave of air strikes on Houthi rebels in Yemen in retaliation for their attacks on shipping lanes in the Red Sea.
But this trend was undermined by some signs of progress in Russia-Ukraine ceasefire talks, with President Donald Trump stating that he will speak to Russian President Vladimir Putin on Tuesday.
Gold also saw some profit-taking after reaching record highs above $3,000 an ounce last week.
Spot gold rose slightly to $3,001.22 an ounce, while gold futures expiring in April were up to $3,010.00 an ounce by 4:55 p.m. ET (20:55 GMT). Spot prices hit a record high of $3,005.08 an ounce on Friday.
Tariffs, economic jitters keep gold strong
Trump on Sunday evening repeated his threats of reciprocal and sectoral tariffs being imposed on April 2- a move that is widely expected to escalate a brewing global trade war.
But markets were uncertain over just how much Trump will commit to the tariffs, given that he had earlier this month flip-flopped on measures against Canada and Mexico.
Still, the two countries, along with China and the European Union, outlined retaliatory measures against the U.S., and are expected to impose even stricter measures against Trump’s reciprocal tariffs.
Fears of trade-related disruptions and a potential tariff-driven bump in inflation drummed up fears of a U.S. recession.
Haven demand was also furthered by anticipation of a barrage of central bank meetings this week, most notably the Federal Reserve, Bank of Japan, and the Bank of England.
Retail sales, meanwhile, rose 0.2% in February, much slower than the 0.6% rise expected, adding to worries softening consumer spending, which makes up the bulk of economic growth.
Other precious metals were higher after clocking strong gains in recent sessions. Platinum futures rose 1.3% to $1,026.15 an ounce, while silver futures fell 0.1% to $34.408 an ounce. Silver prices briefly touched a five-month high.
UBS raises target to $3,200
UBS responded to the rising risks and the recent rally in gold prices by increasing its price target for the precious metal. The firm has adjusted its target to $3,200 per ounce from the previous $3,000 across all tenors.
The surge in gold prices and the revised target from UBS come amid a backdrop of escalating uncertainties in global markets. Investors have been channeling more funds into gold ETFs in recent weeks, seeking a safe haven during turbulent times.
This trend is reflected in the accelerated ETF inflows, signifying a strong investor preference for the perceived stability of gold. UBS emphasizes its positive stance on gold, suggesting that the metal’s current trajectory presents an opportunity for investors.
The Swiss research firm advises building fresh long positions in gold on any pullbacks, indicating confidence in the metal’s continued value as an investment amid the current economic climate.
Copper rises with China stimulus in focus
Among industrial metals, copper prices steadied on Monday with focus squarely on more stimulus measures in China. Expectations of more support from Beijing had spurred a strong run-up in copper prices over the past month.
Benchmark copper futures on the London Metal Exchange rose 0.7% to $9,867.20 a ton, while May copper futures were 1.7% at $4.9775 a pound.
Sentiment over China- the world’s biggest copper importer- was boosted by Beijing announcing a host of measures to boost private consumption. Stronger-than-expected industrial production data also aided sentiment.
Copper was also boosted by Trump flagging plans to impose 25% tariffs on all copper imports- a move that could severely tighten physical supplies in the U.S.
(Senad Karaahmetovic contributed to this article.)