Gold Shines Bright: Record ETF Inflows and Tariff Fears Push Prices Past $3,000

Gold prices climbed above the psychological $3,000 mark in early trading on April 9, 2025, as global trade tensions continued to drive investors toward safe-haven assets.

Spot gold was trading at $3,032.47 per ounce at 06:53 UTC, up $2.00 (+0.07%) from the previous close. The precious metal staged a significant recovery on Tuesday, April 8, rebounding from a near four-week low reached in the previous session.

Gold began Tuesday by gapping higher and breaking above the $3,000 level after experiencing a sharp sell-off following President Trump’s tariff announcements. By the end of Tuesday’s trading, spot gold had risen 0.5% to $2,996.6 per ounce.

Overnight trading continued this positive momentum, with gold futures jumping 0.8% to $3,014.40 per ounce in early Asian trading on Wednesday. This upward trajectory extended into European trading hours as market participants positioned themselves ahead of the implementation of new U.S. tariffs.

Key Market Drivers

Trade Tensions and Tariff Implementation

The primary catalyst behind gold’s recent volatility has been the escalating trade conflict between the United States and major trading partners.

U.S. President Donald Trump’s tariffs on Chinese goods are set to increase to 104% today, April 9, with the measures scheduled to take effect at 12:01 a.m. Eastern time (0401 GMT).

China has responded defiantly to these measures, calling them “blackmail” and vowing to “fight to the end”. Meanwhile, the European Union has announced plans for countermeasures, further intensifying concerns about a prolonged trade war.

“The intensification of the trade conflict could provoke a worldwide recession, which is increasing the demand for safe-haven assets,” noted Jigar Trivedi, a senior analyst at Reliance Securities.

Dollar Weakness

The U.S. dollar’s weakness ahead of the tariff implementation has made gold, which is priced in dollars, more attractive to buyers using other currencies.

“The downward shift in the dollar on tariff worries effectively paved the way for gold to reclaim the $3,000 level,” said Tim Waterer, Chief Market Analyst at KCM Trade. “Despite some bumps, gold is still aiming for new all-time highs given the uncertainty around global growth and inflation.”

Bond Yields

Rising U.S. bond yields have capped some of gold’s gains. The 10-year Treasury yield hit its highest level in over a week, which typically reduces the appeal of non-yielding bullion. This opposing force has created some headwinds for gold’s upward momentum.

Global Gold Markets

India

In India, one of the world’s largest gold consumers, prices have risen significantly. On April 9, 24-carat gold was priced at ₹9,059 per gram in Delhi, while 22-carat gold reached ₹8,305 per gram. In Chennai, 24-carat gold was available for ₹90,440 per 10 grams, with 22-carat gold at ₹82,900 per 10 grams.

This represents an increase of ₹71 from the previous day across major Indian states, reflecting the global uptrend in gold prices.

Domestic Futures Markets

On the Multi Commodity Exchange (MCX) in India, the gold June 5 contract opened at ₹87,998 per 10 grams on April 9, a gain of ₹350 from the previous close. During trading, it reached a high of ₹88,895, representing a gain of 7.79% at one point.

Similarly, silver futures for May 5, 2025 delivery gained in opening trade, opening at ₹89,005 per kg, up ₹261 from the previous close.

ETF Flows and Investor Sentiment

Gold-backed exchange-traded funds recorded their largest quarterly inflows in three years during Q1 2025. According to the World Gold Council, gold ETFs saw inflows of about 226.5 tonnes valued at $21.1 billion in the three months to March 31.

This surge increased their total assets by 3%, bringing them to 3,445 tons by the end of March, the highest level since May 2023. Funds listed in the U.S. led the way, acquiring 133 tons in the first quarter while those listed in Europe attracted 54.8 tons.

“The active start of the year follows a modest net inflow to gold ETFs in 2024 after three years of outflows caused by high interest rates,” noted market observers.

Technical Analysis

From a technical perspective, gold has established key support at the $3,000 psychological level. Additional support levels exist at $2,982 and $2,950 while resistance is observed at $3,025, $3,050 and $3,075.

The RSI (Relative Strength Index) on the daily timeframe has crossed above the 50 neutral level potentially signaling a shift in momentum toward the bullish side. However analysts caution that the daily candle close will determine if this bullish momentum is sustained.

“For now the $3 psychological level has held firm and will need to form a base if bulls are to take control and revisit early April highs” noted technical analysts.

Market Outlook and Projections

The recent rally in gold prices bears resemblance to the surge seen in 1980 during Iranian Revolution when political risk inflation fears gripped markets Gold touched record high.

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