Gold slips as Trump eases tariff threats, Fed shows caution over rate cut

[BENGALURU] Gold inched lower on Tuesday (Mar 25) after US President Donald Trump eased concerns by stating that not all of his proposed tariffs would take effect on Apr 2, while a Federal Reserve official signalled a cautious stance on interest rate cuts this year.

Spot gold was down 0.1 per cent at US$3,010.72 an ounce, as at 0019 GMT. US gold futures was steady at US$3,015.10.

Trump said on Monday automobile tariffs are coming soon even as he indicated that not all of his threatened levies would be imposed on Apr 2 and some countries may get breaks, a move Wall Street took as a sign of flexibility on a matter that has roiled markets for weeks.

Bullion, seen as a hedge against geopolitical and economic uncertainties, often thrives in a low-interest-rate environment.

Atlanta Federal Reserve president Raphael Bostic said he anticipates slower progress on inflation in coming months and as a result now sees the Fed cutting its benchmark rate only a quarter of a percentage point by this year-end.

Bostic anticipated two Fed rate cuts this year, aligning with his colleagues’ meeting last week, where the median projection foresaw two quarter-point rate cuts in 2025.

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Markets will next look to the personal consumption expenditures (PCE) index, the Fed’s preferred inflation measure, due on Friday.

Meanwhile, funds that invest in gold miners are set to attract their largest net monthly inflows in more than a year in March, as record-high gold prices improve firms’ profit outlooks and boost cash flow.

Spot silver fell 0.2 per cent to US$32.94 an ounce, platinum eased 0.2 per cent to US$971.15 and palladium lost 0.1 per cent to US$950.29. REUTERS