Gold prices (XAUUSD) soared during trading on Thursday and continued to rise in early Friday trades (March 14, 2025). This morning, gold reached $2,990 per troy ounce, marking a historic peak.
Yesterday, this precious metal surged by more than $55 or 550 pips, placing it less than $10 or 100 pips away from the psychological threshold of $3,000 per troy ounce. The sharp increase on Thursday was triggered after U.S. President Donald Trump threatened to impose a 200% tariff on imported alcoholic beverages from France and other European nations.
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U.S. Commerce Secretary Howard Lutnick revealed that Trump was “deeply frustrated” after the European Union raised tariffs on American whiskey imports. This action was taken as a response to Trump’s increase of import tariffs on steel and aluminum by 25% from all countries, including the European Union.
The proposed 200% tariff hike is part of a reciprocal policy that is likely to be implemented in April. Under this policy, should other nations increase their tariffs on U.S. imports, Trump is set to retaliate with hikes on tariffs from those countries. This escalation naturally raises the threat of a larger trade war, which could boost demand for gold as a safe haven asset.
In contrast, the heightened risk of a larger trade war has caused the Nasdaq to face renewed pressure, dropping to a six-month low. Meanwhile, the U.S. dollar remains relatively volatile, showing sharp strength against the euro, as seen from the steep decline of EURUSD on Thursday. The GBPUSD and USDJPY also exhibited significant volatility.
