The return of Donald Trump as President of America has brought expected volatility to markets and pushed gold and silver prices higher.
Monday’s inauguration saw significant currency movement as markets reacted to a report that tariffs would not be brought in on day one of the President’s second term, causing the pound and euro to spike higher. The US Dollar Index has dropped over 1.1% in the past five days as markets are now betting on a less aggressive tariff policy than first feared.
The dollar’s decline has pushed gold to $2,762.62 per ounce so far today, the highest gold has been in USD since October 2024, and not far from the US record of $2,792.70. Despite the weaker dollar helping other currencies bounce back from recent lows, new records have also been seen in GBP and EURO, at £2,237.68 and €2,649.02 per ounce respectively.
Further records remain possible in the coming days, but Trump has suggested tariffs of up to 25% are incoming on goods from Mexico and Canada by the start of February. Uncertainty therefore remains high, and some of the dollar’s weakness could be reversed over the course of the next few weeks if new tariffs are announced.
Silver has also benefited from the weaker dollar, passing $31 per ounce briefly this morning, and remaining in the high 30’s. Silver would also benefit from as few tariffs as possible due to it’s higher reliance on industrial demand. Anything that potentially reduces global trade could put pressure on silver.
It will take some time for the new President’s policies to be fully laid out and implemented, but even the initial three days has seen volatility that will likely continue. So far it has been to gold’s benefit, and a new USD gold price record in the coming days would be another positive sign of the direction of travel for gold in the year ahead.
