Trump confirms gold exempt from new US tariffs, supporting prices near $3,200/oz through 2025

In a move that underscores the delicate balance between protectionist trade policies and the sanctity of global commodity markets, the US administration’s clarification that gold imports will remain exempt from new reciprocal tariffs has injected a dose of stability into an otherwise volatile precious metals landscape. This policy stance, emerging amid broader tariff escalations, not only averts potential disruptions to gold supply chains but also reinforces the metal’s role as a hedge against economic uncertainty, potentially capping downside risks in prices while encouraging renewed investor inflows.

The Policy Context and Immediate Market Repercussions

Recent US trade policies have targeted a swath of imports with reciprocal duties, aiming to address perceived imbalances in global commerce. However, the explicit exemption for bullion—encompassing gold in forms such as bars, coins, and ingots—aligns with customs definitions that safeguard investment-grade precious metals. According to a White House fact sheet dated 2 April 2025, this exemption extends to gold alongside silver, platinum, and palladium, preventing tariffs from inflating costs for importers and, by extension, end-users in financial markets.

The announcement follows a period of uncertainty triggered by a US Customs and Border Protection ruling that briefly classified certain gold imports, particularly from Switzerland, under tariff-eligible codes. This led to short-lived market turbulence, with spot gold prices experiencing a dip before rebounding. As of 11 August 2025, data from the World Gold Council indicates that gold has traded resiliently, hovering near recent highs around $3,200 per ounce, buoyed by the clarification that averts duties estimated at up to 39% on Swiss-sourced bars.

Analysts at Goldman Sachs have projected that this exemption could propel gold prices towards $3,150 per ounce by year-end 2025, citing reduced supply frictions and heightened safe-haven demand amid fiscal policy chaos and geopolitical tensions. Their model, which incorporates tariff impacts on inflation and currency volatility, suggests a 5–7% upside from current levels if global trade fragmentation persists.

Broader Economic Implications

Beyond immediate price dynamics, the tariff exemption on gold carries profound implications for the US economy and international trade flows. Gold imports have surged in recent quarters, with the Atlanta Federal Reserve attributing a notable drag on first-quarter 2025 GDP—equivalent to 1.5 percentage points of the reported negative 2% growth—to these inflows. While imports mathematically weigh on GDP calculations, the exemption ensures that physical gold continues to flow unimpeded, supporting liquidity in domestic markets without the added cost burden of duties.

This policy also mitigates risks to the numismatic and bullion industries, which rely on seamless access to global supplies. Switzerland, a key hub for gold refining and export, faced potential disruptions that could have rerouted trade flows to alternative markets like India or Canada. The Swiss Gold Association has highlighted that tariffs might have curtailed the international movement of physical gold, potentially leading to fragmented pricing and reduced market efficiency. By exempting gold, the US avoids politicising a traditionally neutral asset, preserving its appeal as a store of value in an era of dollar strength and inflationary pressures.

From a macroeconomic perspective, the decision intersects with monetary policy considerations. The Federal Reserve’s projections, as outlined in their June 2025 meeting summary, anticipate transitory inflation spikes from broader tariffs but maintain a neutral stance on rates. Gold’s exemption could temper these inflationary effects by stabilising commodity inputs, indirectly aiding the Fed’s 2% inflation target. Reuters market commentary from 11 August 2025 notes that softer US jobs data has bolstered expectations for a September rate cut, with gold positioned to benefit from lower yields and a stable dollar.

Investor Sentiment and Strategic Positioning

Sentiment among institutional investors, as gauged by the World Gold Council’s May 2025 market commentary, remains bullish on gold despite tariff-related headwinds. Professional sources like IG Market Strategists have expressed optimism, attributing gold’s firmness to defensive asset demand amid portfolio volatility. This view is echoed in a CNBC report from 8 August 2025, where analysts warned that unexpected levies could redraw gold trade maps, yet the subsequent exemption has restored confidence.

For investors, the policy underscores gold’s dual role: as a hedge against stagflationary risks and a beneficiary of trade policy fragmentation. Bloomberg data from 3 April 2025 reveals that a prior rush of gold imports to the US halted abruptly upon initial exemption announcements, only to resume with renewed vigour. This pattern suggests that tariff clarity enhances gold’s attractiveness relative to other assets, potentially diverting capital from equities or cryptocurrencies during periods of uncertainty.

• Supply Chain Resilience: Exemption safeguards against bottlenecks, ensuring steady inflows from major exporters like Switzerland, which account for a significant portion of global refined gold.
• Valuation Dynamics: Historical comparisons show gold’s price-to-earnings multiples expanding during trade wars; current exemptions could mirror the 2018–2019 period, where prices rose 20% amid US-China tensions.
• Geopolitical Hedge: In a fragmented world, gold’s tariff-free status bolsters its safe-haven premium, with analyst models from AInvest forecasting a 10% premium over Treasuries by mid-2026 if tensions escalate.

Risks and Forward-Looking Scenarios

While the exemption provides relief, it is not without caveats. Ongoing investigations into other commodities could indirectly affect gold through currency fluctuations or broader market sentiment. For instance, a strengthening US dollar—driven by tariff-induced capital inflows—might exert downward pressure on gold prices, as seen in early 2025 when the metal briefly traded off highs.

Analyst-led forecasts from FXStreet’s 10 August 2025 analysis warn of a potential “golden chains” scenario, where tariffs on adjacent sectors amplify gold’s volatility. Their base case, however, aligns with Goldman Sachs, predicting sustained gains if the exemption holds firm. Investors should monitor inflation data releases this week, as a hotter-than-expected print could strengthen the dollar and cap gold’s upside, per Simpson’s commentary in Reuters.

In summary, the US policy clarifying gold’s exemption from tariffs not only stabilises a critical market but also highlights the metal’s enduring allure in uncertain times. As trade policies evolve, gold stands poised to navigate the turbulence, offering investors a reliable anchor amid the storms of global economics.

References

• Bloomberg. (2025, April 3). Rush to get gold to the US halts abruptly with tariff exemption. https://www.bloomberg.com/news/articles/2025-04-03/rush-to-get-gold-to-the-us-halts-abruptly-with-tariff-exemption
• CNBC. (2025, August 8). Gold futures trade off highs as White House to issue clarification on bullion tariffs. https://www.cnbc.com/2025/08/08/gold-futures-trade-off-highs-as-white-house-to-issue-clarification-on-bullion-tariffs.html
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