Precious Metals Jump Amid Trump Tariffs, Uncertainty

 

Gold and Silver Jump Amid Trump Tariff Fallout

(Bullion News Network) – Gold and silver prices jumped to begin the week after President Trump’s first round of tariffs was announced over the weekend. The White House formalized measures to impose a 25% tariff on Mexico and Canada, as well as an additional 10% tariff on China. The move was met with widespread condemnation, and safe haven asset prices rose last Friday in anticipation of the news. Monday began with similarly strong performances out of gold and silver. Gold continued its tear above the $2,800/ozt line, gaining over $18 as traders grappled with the potential impact that the tariffs could have on the precious metals market. Silver prices increased as well, with the metal gaining nearly $0.30 on the heels of the first of President Trump’s promised tariffs. 

Although some analysts expected an exemption for certain precious metals, the blanket tariffs on Canada and Mexico provided no such exception for bullion investments. This news, in conjunction with a flight toward safe haven assets in the face of uncertainty, drove metal prices sharply higher to begin the first week of February. Wall Street dipped on the news of the tariffs, though AP News reports that the response was notably more muted than some analysts projected.

Market sentiment later Monday afternoon as both Canada and Mexico announced that they had come to separate agreements with President Trump to temporarily stall the tariffs. Prime Minister Trudeau announced a plan to avoid the president’s tariffs by, among other commitments, placing 10,000 Canadian military personnel to help secure the United States’ Northern border. A similar agreement was reportedly reached between President Trump and Mexican President Claudia Sheinbaum, who committed 10,000 of her country’s troops in an effort to combat drug smuggling along America’s southern border.

Both the Dow and S&P 500 recovered a portion of their losses after North America’s three most formidable economies secured a temporary reprieve against the 25% tariffs, which economists believe would result in extreme economic turmoil across the continent. In the cryptocurrency markets, digital assets dropped last week as uncertain traders pulled their investments in order to pivot into more secure commodities. Bitcoin recouped last week’s losses today, reversing course after Canada and Mexico narrowly averted their respective 25% tariffs. 

President Trump confirmed the two agreements on social media just hours ago, saying that tariffs on Canada and Mexico will be delayed thirty days while each country agrees to the particulars of their border security commitments. Whether the tariffs will resume in March is unclear, although President Trump appears interested in extending the delay indefinitely, should Canada and Mexico follow through on their promises to increase security at the United States’ borders. 

Gold and silver ended Monday in the green, and experts anticipate that tariff news will play a key role in safe haven price action heading into February.