AUGUST 8, 2025
Gold’s rally is also driven by concerns over the global economic outlook. – DENIS BALIBOUSE/REUTERS
Gold climbed to a fresh record high on Friday after a U.S. government agency clarified that import tariffs would apply to one-kilo gold bars, sparking turmoil in the global bullion market.
In afternoon trade in Europe, futures rose 1% to $3,488.90 a troy ounce after reaching a peak of $3,534.20 earlier in the session. Prices are on track for a weekly gain of 2.4%.
Gold bars from Switzerland, the world’s largest gold refining hub, previously entered the U.S. duty free. But in a July 31 ruling in response to a Swiss refinery’s subsidiary, the U.S. Customs and Border Protection said that gold bars would now be subject to President Trump’s reciprocal tariffs, which were 10% on Switzerland at the time. Those tariffs have now surged to 39% as of Thursday.
“The imposition of tariffs on these gold cast products makes it economically unviable to export them to the U.S., thereby eliminating any future trade deficit arising from gold exports,” said the Swiss Association of Manufacturers and Traders of Precious Metals in a statement.
The association, which represents manufacturers and traders in the Swiss precious-metal industry, said it remains committed to a “constructive” dialogue with U.S. authorities and international partners.
Switzerland’s State Secretariat for Economic Affairs declined to comment on the matter, saying discussions with the U.S. are underway and have been focused on reducing tariffs.
One-kilo gold bars are the most common form of the metal traded on metals-trading exchange Comex. The global gold market relies on futures traded on Comex to hedge its positions, with the assumption that metals can easily be imported U.S. warehouses to settle contracts if necessary, according to UBS strategist Joni Teves.
Gold’s rally is also driven by concerns over the global economic outlook after Trump’s new tariffs came into effect Thursday and weak U.S. data spurred bets that the Federal Reserve will soon cut interest rates. According to the CME Group’s FedWatch tool, traders currently see a 89.4% probability that the Fed will cut its benchmark interest rate by 25 basis points in September.
Meanwhile, Trump nominated Stephen Miran to fill a vacancy on the Fed’s Board of Governors on a short-term basis, a move seen by the market as a potential shift toward a more dovish monetary policy stance.
Courtesy/Source: WSJ
