{"id":97206,"date":"2025-01-14T15:55:27","date_gmt":"2025-01-14T13:55:27","guid":{"rendered":"https:\/\/ironfx-com-php8.wp-dev.int.theitops.net\/?p=97206"},"modified":"2025-01-14T15:55:28","modified_gmt":"2025-01-14T13:55:28","slug":"gold-outlook-trumps-tariff-ambitions","status":"publish","type":"post","link":"https:\/\/www.ironfxcn.com\/th\/gold-outlook-trumps-tariff-ambitions\/","title":{"rendered":"Gold Outlook: Trump\u2019s tariff ambitions"},"content":{"rendered":"

Since our last report<\/a>, Gold\u2019s price appears to be moving in a relatively sideways fashion. In today\u2019s report, we intend to have a look at the implications of Trump\u2019s tariff policies, whilst discussing last week\u2019s jobs report. For a rounder view, we conclude the report with a technical analysis of gold\u2019s daily chart.\u00a0\u00a0.\u00a0\u00a0<\/p>\n\n\n\n

Trump\u2019s economic policies<\/strong><\/h2>\n\n\n\n

President-elect Trump\u2019s inauguration<\/strong> date is set to occur in 6 days on the 20th<\/sup> of January 2025. President-elect Trump\u2019s economic policies<\/strong> are beginning to take shape and in particular, his tariff plans which do not appear to have spared either friend or foe, as seen by the President-elect\u2019s comments to impose a 25% tariff on imports from Canada. <\/p>\n\n\n\n

The incoming US administration could potentially use the International Emergency Economic<\/strong> Powers Act<\/strong>, which would allow the new administration to implement tariffs on day one by citing an unusual and extraordinary threat and declaring a national emergency. <\/p>\n\n\n\n

The proposed Trump tariffs have sparked widespread concern about a resurgence of inflationary pressures in the US economy, and thus with the date of his inauguration rapidly approaching, gold\u2019s appeal may have increased given its status as a hedge against inflation. In conclusion, we would not be surprised to see gold\u2019s appeal increasing to investors as the new administration takes over and tariff rhetoric potentially turns into legislation. However, should Trump\u2019s tariff ambitions be scaled back, it may have the opposite effect and thus could weigh on gold prices<\/strong>. The aforementioned scenario appears to be in play, with Bloomberg reporting that Trump\u2019s team is exploring gradual tariff hikes, in a bid to avoid a spike in inflation. However, the plan has not been presented to Trump per the same report.<\/p>\n\n\n\n

US employment report comes in hotter than expected<\/strong><\/h2>\n\n\n\n

This past Friday, the US employment data for December<\/strong> was released. The Non-Farm Payrolls figure<\/strong> was expected to drop to 154k yet exceeded expectations by coming in at 256k. Moreover, the unemployment rate<\/strong> was also expected to remain unchanged at 4.2% yet came in 4.1%. Overall, the US employment data<\/strong> has been described as a blowout jobs report, which showcased the resiliency of the US Labour market<\/strong>. The stronger-than-expected employment data, appears to have intensified expectations by market participants that the Fed may keep rates higher for longer, with Fed Fund Futures currently implying one rate cut in September for the year. <\/p>\n\n\n\n

Thus, given the assumed inverse relationship between gold and the dollar, the release may have temporarily weighed on gold\u2019s price in spite of the aforementioned relationship being relatively inactive the past week or so. Hence attention may turn to the release of the US CPI rates on Wednesday<\/strong> which are expected to accelerate from 3.4% to 3.7%, implying persistent inflationary<\/strong> pressures<\/strong> in the US economy. <\/p>\n\n\n\n

Therefore, in theory, an acceleration of inflationary pressures in the US economy could intensify calls for the Fed to remain on hold for a prolonged period of time , which may be seen as bullish for the greenback and thus could weigh on the precious metal\u2019s price. On the flip side a lower-than-expected inflation print, could have the opposite effect.<\/p>\n\n\n\n

Gold Technical Analysis<\/strong><\/h2>\n\n\n\n

XAUUSD 4H Chart<\/strong><\/strong><\/h3>\n\n\n\n
\"XAU\/USD<\/figure>\n\n\n\n