Last week, the price of gold hit a new high, with bullion per ounce exceeding the $3,300 mark. This surge reflects a growing demand for safe haven assets as investors respond to a weakening U.S. dollar and falling tech stocks.
The sharp market volatility observed in the week may be attributed to a new investigation ordered by President Trump into the need for levies on critical minerals. Analysts believe this move could further escalate the ongoing global trade war, prompting more countries to retaliate with their own tariffs in response to America’s recent actions.
China, one of the hardest hit countries by U.S. tariffs, was hit with 145% levy on its exports. In retaliation, Beijing imposed reciprocal tariffs on American goods, intensifying the standoff between the two superpowers.
Despite the tensions, a recently released report suggests that China may be open to renewed trade negotiations-if America appoints a representative who demonstrates greater diplomatic tact and refrains from inflammatory rhetoric.
Since the beginning of the year, the price of gold has risen by more than 26%, consistently hitting new highs.
Many investors are steering clear of long-term positions due to the unpredictability of the Trump administration’s stance on tariffs. The mounting concerns over a potential global recession have only increased gold’s appeal.
Gold typically performs well in times of uncertainty as investors shift from riskier assets like bonds and stocks to more stable stores of value. Many analysts expect this upward trend to continue. A forecast by Goldman Sachs Group Inc. estimates that gold may reach $4000 per ounce by mid-2026.
A recent survey conducted by the Bank of America revealed that over 40% of respondents expect gold to be the best performing asset class this year. This bullish sentiment is echoed by central banks, which have been steadily increasing their gold reserves while investors increase their holdings in gold-backed ETFs.
In related developments, the Trump administration has announced inquests into pharmaceutical and semiconductor imports, with the aim of introducing tariffs on grounds that great reliance on foreign chips and medicines is a national security threat. This comes after imposing tariffs on automobile parts, automobiles, aluminum and steel.
Washington also revealed that it was in talks with different trade partners to reduce trade barriers in exchange for potential relief on American tariffs. According to Luchen Wang of Galaxy Futures Co., the power struggle between major nations will carry on, with gold’s safe haven status likely to continue driving short-term demand.
As short term demand for gold remains bullish, entities like Aston Bay Holdings Ltd. (TSX.V: BAY) (OTCQB: ATBHF) owning properties with gold deposits could be well-positioned to attract increased interest from investors.
NOTE TO INVESTORS: The latest news and updates relating to Aston Bay Holdings Ltd. (TSX.V: BAY) (OTCQB: ATBHF) are available in the company’s newsroom at https://ibn.fm/ATBHF
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