With the constant barrage of new tariff announcements, the pausing of old tariff announcements, and the looming threat of inflation, global trade tensions are high and stock markets are turbulent. One asset though, is taking advantage of the economic turbulence. Gold is rallying and has constantly been hitting new records due to investors’ anxiety around the stock market and the mixed messages around tariffs. Investors consider gold a safe haven during economically turbulent times because they want an asset with protection against inflation and volatile stock markets. Here’s a summary of gold’s performance in the first quarter of 2025. 

January 

Overall, gold was bullish in January. Gold was hitting a slump the first week of January when the US dollar posted a two-year high. The dollar rallied because the Federal Reserve warned that it would cut interest rates slower in 2025. Spot gold fell 0.04% to 2638 USD/Oz. The sentiments surrounding gold recovered and Gold saw a brief rally in mid-January based on reactions following softer-than-expected inflation numbers. Investors were hoping for the Federal Reserves to cut interest rates, which boosted gold’s spot price above 2700 USD/Oz. 

February 

On February 1st, Trump ordered the first round of tariffs on goods imported from Mexico, Canada, and China. These tariffs were set to start on February 4th, imposing a 10% tax on imports from China and a 25% tax on imports from Canada and Mexico. The same day the new tariffs were announced, gold first broke out of the 2800 USD/Oz barrier. After Trump’s announcement, spot gold climbed 0.8% to 2819 USD/Oz, briefly hitting 2850. On February 4th when the new tariffs went into effect, China announced countermeasures on crude oil, natural gas, agricultural machinery, and large-engine cars imported from the US, set to take effect on February 10th. This announcement from China further pushed gold to new heights because geopolitical trade tensions enhanced gold’s safe-haven appeal.  On February 10th, when the Chinese tariffs were set to take effect, gold broke the 2900 USD/Oz barrier for the first time, setting yet another record high. Spot prices in February kept rising until the end of the month when gold started cooling. By the end of February, there was a modest pickup in US treasury bond yields that backed the US dollar. With gold’s inverse relationship with the US dollar, the stronger US dollar caused gold prices to drop and gold hovered around 2880 USD/Oz.

March 

At the beginning of March, gold was stalling. The absence of macroeconomic news kept demand for gold at an impasse. However, investor sentiment towards gold was bullish, especially, since the dollar remained near its lowest points last year. With the growing uncertainty towards the economy and stock markets amidst the tariff announcements, gold remained afloat above 2900 USD/Oz. Despite a slow beginning in March, gold would break out of 3000 USD/Oz for the first time in mid-March. Market concerns over Trump’s new tariff announcement on all steel and aluminum imports have raised global fears of inflation and a recession. On the same day these tariffs were announced, the European Union took action and announced new duties on US industrial and farm exports, which could cover a few billion dollars worth of goods. Canada announced on the same day that they will impose tariffs on the US starting March 13. The escalating trade tensions between the US and its trading patterns have been shaking up financial markets globally, and raising concern about the future of the global economy, which led investors to eye gold and its status as a safe haven asset. To close out the month, gold broke 3,100 USD/Oz for the first time amidst inflation worries over automotive tariffs, giving gold its fourth consecutive weekly gain.