Gold Rises Amid Rising Trade Tensions Between Washington and New Delhi

Gold prices rose during trading on Thursday, August 7, supported by investors' shift towards safe havens, following U.S. President Donald Trump's decision to impose new tariffs of 25% on Indian imports, deepening the trade dispute between the two countries.

Gold recorded a 0.7% increase in spot trading, reaching $3393.78 per ounce, while U.S. gold futures jumped by the same rate to settle at $3458.40 per ounce.

In this regard, Tim Waterer, senior market analyst at "KCM Trade", commented to Reuters, saying: "Trump's ongoing threats to impose new tariffs keep gold in the spotlight as a defensive tool for investors."

This increase comes after Trump announced on Wednesday additional tariffs on Indian imports, accusing New Delhi of continuing to import Russian oil, amid stalled bilateral trade talks.

These tariffs are expected to take effect 21 days after August 7, which could raise the total tariffs on some Indian products to 50%, one of the highest rates applied to Washington's trading partners.

The U.S. administration also revealed its intention to impose tariffs of up to 100% on semiconductor imports, exempting companies operating within U.S. territory or committed to relocating their production there, in a move aimed at stimulating domestic industry.

In a related context, the U.S. dollar maintained its low levels near its lowest point in over a week, after U.S. labor market data showed greater-than-expected weakness, bolstering expectations for the Federal Reserve to cut interest rates during the upcoming September meeting.

The "FedWatch" tool from "CME" indicates that 95% of market participants expect a 25 basis point rate cut next month. Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, stated that "the board may have to cut rates soon in response to the slowdown in the U.S. economy."