Gold retraced some of its gains on Friday after momentarily surpassing the $4,000 per ounce threshold for the second time this week, as U.S. President Donald Trump’s caution regarding potential new tariffs on China intensified a movement towards safe-haven assets. Spot gold experienced an increase of 0.4%, reaching $3,989.49 per ounce as of 1:40 pm. The metal recorded a 2.7% increase this week. U.S. President Donald Trump stated on Friday that there is no justification for a meeting with China’s President Xi Jinping in two weeks in South Korea as scheduled. The U.S. is contemplating a significant escalation in tariffs on imports from China. In the wake of recent developments, gold momentarily surpassed the $4,000 per ounce threshold, reaching a session peak of $4,022.52.

“Heating up the trade war again will tank the dollar and be good for safe-havens,” stated Tai Wong. The U.S. dollar experienced a decline of 0.5%, resulting in a reduction in the cost of bullion priced in dollars for international purchasers. Markets are closely observing the risks associated with the potential collapse of the French government and the continuing government shutdown in the United States. Moreover, market participants are expecting the U.S. Federal Reserve to reduce interest rates by 25 basis points in both October and December. Non-yielding bullion, which reached a peak of $4,059.05 on Wednesday, is conventionally viewed as a safeguard amid periods of widespread uncertainty. Geopolitical risks, combined with robust central bank gold purchases, inflows into exchange-traded funds, expectations of U.S. rate cuts, and economic uncertainties related to tariffs, have all played a role in the rally of gold.

On balance, a short-term pullback in prices appears likely, considering the rapid increase in gold prices observed in recent weeks. “But over the next couple years, gold prices are likely to grind higher,” stated Hamad Hussain. Silver is experiencing gains from the same dynamics propelling gold’s ascent, coupled with apprehensions regarding supply shortages and increasing demand for the metal. Silver increased by 2.1% to $50.13 per ounce, following a previous peak of $51.22. The asset has experienced an increase exceeding 73% year-to-date. Silver futures for December 2025 were priced at $47.32. “Silver’s backwardation is a clear indicator – physical demand is overwhelming paper supply… If backwardation holds and physical demand keeps rising, silver breaking and sustaining above $50 is very realistic,” stated Alex Ebkarian.

Backwardation occurs when the spot price of a commodity exceeds its futures price. In the realm of metals, platinum experienced a decline of 1.4%, settling at $1,596.55, which contributed to a weekly loss. Conversely, palladium saw a slight decrease of 0.3%, priced at $1,406.87, yet it recorded a substantial weekly increase exceeding 12.6%. Gold reduces its gains following a short surge past $4,000 per ounce in response to Trump’s warning regarding tariffs on China.