Gold prices are expected to continue rising due to the trade war initiated by President Donald Trump, along with increasing expectations that the U.S. Federal Reserve will further ease its monetary policy following the announcement of U.S. inflation rates.

However, the rising demand for the U.S. dollar and increasing U.S. bond yields directly impact gold’s upward momentum. Hopes for a resolution to the trade war between the U.S. and Canada have reduced demand for U.S. government bonds, leading to higher U.S. bond yields.

If the global trade war escalates further, it could heighten the risk of an economic recession, increasing the likelihood of additional interest rate cuts by the Fed. This would weaken the U.S. dollar once again while simultaneously pushing gold prices to new record highs.

Source: Fxstreet