Gold and silver prices hit high after tariff threat
Gold and silver prices reached record levels after US President Donald Trump threatened to impose new tariffs on eight European countries that oppose his bid to take over Greenland.
The gold price reached $4,689.39 (£3,499) per ounce on Monday, while silver rose to $94.08 per ounce.
Precious metals are seen as safer assets to hold in times of uncertainty, and both gold and silver prices have risen sharply in the past year.
The debate over Greenland’s future has escalated after the US threatened extra tariffs, and there are reports the EU is preparing to retaliate.
While gold and silver prices rose, stock markets in Asia experienced moderate declines and Japan’s Nikkei index closed with a 0.6% loss.
In Europe, London’s FTSE 100 index fell just 0.1% and shares in gold miners Fresnillo and Endeavor rose following the latest rise in precious metal prices.
But there were bigger declines elsewhere, with companies seen as vulnerable to the latest threatened tariffs taking the biggest hit. While the Dax index in Germany fell by 1%, automobile manufacturers BMW, Mercedes-Benz and VW were among the biggest losers.
In France, Cac 40 fell 1.2% as luxury goods firms took a hit. LVMH’s shares fell 3.8% and Hermes’ shares fell 2.5%.
But European defense stocks rose, with Germany’s Rheinmetall and France’s Thales gaining ground.
Markets in the US are closed on Monday for a public holiday.
On Saturday, Trump announced that a 10 percent tariff on goods from Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland would go into effect on Feb. 1 but could rise to 25 percent later and would last until a deal is reached on Greenland.
Reports have suggested the EU is considering responding with a €93bn (£80bn) package of tariffs on US imports.
The price of gold has risen more than 60% in the past year, partly due to concerns about global tensions and economic uncertainty.
“Gold has hit new highs in its sparkling rise,” said Susannah Streeter, chief investment strategist at Wealth Club.
“As concerns spread about the repercussions of aggressive U.S. trade and geopolitical policies, the precious metal becomes even more attractive as a safe haven.”
