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This week’s movements of gold futures amid growing different concerns and doubts over the international geopolitical moves to cope with President Trump’s trade tariff deadline which has already been extended from July 9 has already surged skepticism over its potential effectiveness to pursue the trading partners on the fixed terms but have also extend the doubts on further step backs if the desired targets are not met till August 1, 2025.
Undoubtedly, this step backed by Trump has provided some strength to the US Dollar, which was on a steep slide since the joining of President Trump on Jan. 20, 2025, when the greenback was trading at $109.751 while the gold futures were at $2778 and the USD/JPY was at $156.
Soon after Trump announced his trade tariff agenda, which altered the trend for gold, the US dollar, and the Japanese Yen, it also triggered extreme economic uncertainty surrounding the global trade equations.
Globally, investors started to grab chunks of the precious metals and other commodities amid fear of reciprocal tariffs by the major trading partners of the U.S., which resulted in a steep slide of USD/YEN while the gold futures started to ramp up due to a buying spree by the central banks.
Amid this humbug, gold futures tested a new high at $3510 on Apr. 22, 2025, while the USD tested a fresh low at 97.65 and the USD/YEN $140.
Since then thrice of them were trading in a fixed trading range but now showing probabilities of reversal due to changing stances in global order amid changing strategies to resolve the adverse circumstances with steps taken by the major trading partners of the U.S. while the U.S. President Donald Trump still trying to change his hardliner stance on trade tariff by extending deadlines to provide sufficient time to trading partner to remain calm enough while they agree to tariff equations.
Undoubtedly, Trump’s trade tariff policies seem to dent not only the US economy but also the others, too, by raising concerns over a steep surge in inflation globally.
Now, I anticipate that any further extension in trade tariff deadline will raise the doubts over the impact of tariff trade tussles as these economic step turns to be a mixture of political genesis which looks evident enough to provide strength to the US dollar, Japanese Yen and could trigger exhaustion in gold futures to test fresh lows within coming weeks as three of them are teetering in narrow range before a directional move.
Finally, I conclude that this action-reaction could start this weekend as the yen remained on the back foot heading into upper house elections on Sunday in Japan, with polls suggesting the ruling coalition is at risk of losing its majority, a development that would stir policy uncertainty and complicate tariff negotiations with the U.S.
Secondly, the announcement of U.S. retail sales data pushed the US dollar index to test a high at 98.951 on Thursday for the first time since June 23, which looks evident enough to maintain this uptrend next week, while President Trump is expected to take some positive steps to make the trade policies more adaptive for the trading partners.
Disclaimer: Readers are advised to create any position in gold, US dollar, and Japanese Yen at their own risk as this analysis is based only on observations.