Gold prices are firming up again after falling below the $3,000 mark. On Thursday, Gold is trading around $3,125 per ounce, up by $40 or 1.29% over the previous day’s price. In India, the gold rate today is Rs 93,380.

The market believes the recent surge is largely because of the bond market rout that was witnessed on Tuesday. President Trump’s tariff implementation led to a crack in the bond market, with selling pressure on US Treasuries causing lower bond prices and increased bond yields. There was widespread selling pressure on US Treasuries that led to a spike in 10-year US yield towards 4.5%, a six-week high.

The fresh interest in gold is fueled by safe-haven demand amid escalating US-China tensions. Bullion is still a solid hedge against a more chaotic global economy. The recovery of gold price reflects increased investor nervousness over tariff threats and the possible alteration of global trade standards.

Also Read: Gold surges and then retreats on Trump Tariffs. Should you buy Gold now?

President Trump raised tariffs on Chinese imports to 125%, effective immediately, just hours after China increased duties on US goods to 84%.

This series of back-and-forth tariff hikes between the two major economies is expected to escalate further. However, Trump announced that the US is lowering duties to 10% for a 90-day period to support trade talks with most countries.

Trump has offered a 90-day reprieve on his reciprocal tariffs for countries that have not retaliated. Still, Trump continued escalating the trade war with China by raising their tariffs to 125%, while measures on the EU are unlikely to be paused because of Brussels’ retaliation announcement.

Meanwhile, markets continued to digest the latest FOMC minutes, which show near-unanimous concerns over higher inflation and slower growth. Investors are now awaiting US CPI and PPI data on Friday for insights into the Fed’s interest rate outlook. Elsewhere, the World Gold Council reported gold-backed ETFs saw inflows of 226.5 metric tons, worth $21.1 billion, in Q1.

Also Read – Silver, the New Gold: What is behind the shiny metal’s record-breaking rally?